Correlation Between Cisco Systems and Natixis Investment
Can any of the company-specific risk be diversified away by investing in both Cisco Systems and Natixis Investment 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 Cisco Systems and Natixis Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cisco Systems and Natixis Investment Managers, you can compare the effects of market volatilities on Cisco Systems and Natixis Investment 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 Cisco Systems with a short position of Natixis Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and Natixis Investment.
Diversification Opportunities for Cisco Systems and Natixis Investment
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cisco and Natixis is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and Natixis Investment Managers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis Investment and Cisco Systems 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 Cisco Systems are associated (or correlated) with Natixis Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis Investment has no effect on the direction of Cisco Systems i.e., Cisco Systems and Natixis Investment go up and down completely randomly.
Pair Corralation between Cisco Systems and Natixis Investment
Given the investment horizon of 90 days Cisco Systems is expected to generate 8.88 times more return on investment than Natixis Investment. However, Cisco Systems is 8.88 times more volatile than Natixis Investment Managers. It trades about 0.05 of its potential returns per unit of risk. Natixis Investment Managers is currently generating about 0.17 per unit of risk. If you would invest 4,554 in Cisco Systems on August 30, 2024 and sell it today you would earn a total of 1,375 from holding Cisco Systems or generate 30.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 91.11% |
| Values | Daily Returns |
Cisco Systems vs. Natixis Investment Managers
Performance |
| Timeline |
| Cisco Systems |
| Natixis Investment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Cisco Systems and Natixis Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cisco Systems and Natixis Investment
The main advantage of trading using opposite Cisco Systems and Natixis Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems position performs unexpectedly, Natixis Investment 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 Natixis Investment will offset losses from the drop in Natixis Investment's long position.| Cisco Systems vs. NETGEAR | Cisco Systems vs. Clearfield | Cisco Systems vs. ABIVAX Socit Anonyme | Cisco Systems vs. Morningstar Unconstrained Allocation |
| Natixis Investment vs. VictoryShares USAA Core | Natixis Investment vs. American Century Diversified | Natixis Investment vs. IQ MacKay Municipal | Natixis Investment vs. IQ MacKay Municipal |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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