Correlation Between MEITUAN UNSPADR2B and National Bank
Can any of the company-specific risk be diversified away by investing in both MEITUAN UNSPADR2B and National Bank at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining MEITUAN UNSPADR2B and National Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEITUAN UNSPADR2B and National Bank Holdings, you can compare the effects of market volatilities on MEITUAN UNSPADR2B and National Bank and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in MEITUAN UNSPADR2B with a short position of National Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEITUAN UNSPADR2B and National Bank.
Diversification Opportunities for MEITUAN UNSPADR2B and National Bank
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MEITUAN and National is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MEITUAN UNSPADR2B and National Bank Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank Holdings and MEITUAN UNSPADR2B is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on MEITUAN UNSPADR2B are associated (or correlated) with National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank Holdings has no effect on the direction of MEITUAN UNSPADR2B i.e., MEITUAN UNSPADR2B and National Bank go up and down completely randomly.
Pair Corralation between MEITUAN UNSPADR2B and National Bank
Assuming the 90 days trading horizon MEITUAN UNSPADR2B is expected to generate 3.07 times more return on investment than National Bank. However, MEITUAN UNSPADR2B is 3.07 times more volatile than National Bank Holdings. It trades about -0.03 of its potential returns per unit of risk. National Bank Holdings is currently generating about -0.13 per unit of risk. If you would invest 4,340 in MEITUAN UNSPADR2B on September 12, 2024 and sell it today you would lose (180.00) from holding MEITUAN UNSPADR2B or give up 4.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MEITUAN UNSPADR2B vs. National Bank Holdings
Performance |
| Timeline |
| MEITUAN UNSPADR2B |
| National Bank Holdings |
MEITUAN UNSPADR2B and National Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEITUAN UNSPADR2B and National Bank
The main advantage of trading using opposite MEITUAN UNSPADR2B and National Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEITUAN UNSPADR2B position performs unexpectedly, National Bank can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in National Bank will offset losses from the drop in National Bank's long position.| MEITUAN UNSPADR2B vs. National Bank Holdings | MEITUAN UNSPADR2B vs. Check Point Software | MEITUAN UNSPADR2B vs. Align Technology | MEITUAN UNSPADR2B vs. COMINTL BANK ADR1 |
| National Bank vs. Fifth Third Bancorp | National Bank vs. Regions Financial | National Bank vs. Superior Plus Corp | National Bank vs. SIVERS SEMICONDUCTORS AB |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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