Correlation Between Aquagold International and Nebraska Municipal
Can any of the company-specific risk be diversified away by investing in both Aquagold International and Nebraska Municipal 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 Aquagold International and Nebraska Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquagold International and Nebraska Municipal Fund, you can compare the effects of market volatilities on Aquagold International and Nebraska Municipal 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 Aquagold International with a short position of Nebraska Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquagold International and Nebraska Municipal.
Diversification Opportunities for Aquagold International and Nebraska Municipal
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aquagold and Nebraska is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Nebraska Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nebraska Municipal and Aquagold International 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 Aquagold International are associated (or correlated) with Nebraska Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nebraska Municipal has no effect on the direction of Aquagold International i.e., Aquagold International and Nebraska Municipal go up and down completely randomly.
Pair Corralation between Aquagold International and Nebraska Municipal
Given the investment horizon of 90 days Aquagold International is expected to under-perform the Nebraska Municipal. In addition to that, Aquagold International is 41.51 times more volatile than Nebraska Municipal Fund. It trades about -0.21 of its total potential returns per unit of risk. Nebraska Municipal Fund is currently generating about 0.12 per unit of volatility. If you would invest 920.00 in Nebraska Municipal Fund on December 1, 2024 and sell it today you would earn a total of 6.00 from holding Nebraska Municipal Fund or generate 0.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Aquagold International vs. Nebraska Municipal Fund
Performance |
| Timeline |
| Aquagold International |
| Nebraska Municipal |
Aquagold International and Nebraska Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aquagold International and Nebraska Municipal
The main advantage of trading using opposite Aquagold International and Nebraska Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquagold International position performs unexpectedly, Nebraska Municipal 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 Nebraska Municipal will offset losses from the drop in Nebraska Municipal's long position.| Aquagold International vs. PepsiCo | Aquagold International vs. Coca Cola Consolidated | Aquagold International vs. Monster Beverage Corp | Aquagold International vs. Celsius Holdings |
| Nebraska Municipal vs. Neiman Large Cap | Nebraska Municipal vs. Lord Abbett Affiliated | Nebraska Municipal vs. Calvert Large Cap | Nebraska Municipal vs. Vest Large Cap |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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