Correlation Between National Retail and Bet-at-home
Can any of the company-specific risk be diversified away by investing in both National Retail and Bet-at-home 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 National Retail and Bet-at-home into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Retail Properties and bet at home AG, you can compare the effects of market volatilities on National Retail and Bet-at-home 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 National Retail with a short position of Bet-at-home. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Retail and Bet-at-home.
Diversification Opportunities for National Retail and Bet-at-home
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between National and Bet-at-home is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding National Retail Properties and bet at home AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on bet at home and National Retail 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 National Retail Properties are associated (or correlated) with Bet-at-home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of bet at home has no effect on the direction of National Retail i.e., National Retail and Bet-at-home go up and down completely randomly.
Pair Corralation between National Retail and Bet-at-home
Assuming the 90 days trading horizon National Retail Properties is expected to generate 0.81 times more return on investment than Bet-at-home. However, National Retail Properties is 1.23 times less risky than Bet-at-home. It trades about 0.11 of its potential returns per unit of risk. bet at home AG is currently generating about -0.21 per unit of risk. If you would invest 4,011 in National Retail Properties on September 1, 2024 and sell it today you would earn a total of 187.00 from holding National Retail Properties or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Retail Properties vs. bet at home AG
Performance |
| Timeline |
| National Retail Prop |
| bet at home |
National Retail and Bet-at-home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Retail and Bet-at-home
The main advantage of trading using opposite National Retail and Bet-at-home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Retail position performs unexpectedly, Bet-at-home 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 Bet-at-home will offset losses from the drop in Bet-at-home's long position.| National Retail vs. Apple Inc | National Retail vs. Apple Inc | National Retail vs. Apple Inc | National Retail vs. Apple Inc |
| Bet-at-home vs. SIVERS SEMICONDUCTORS AB | Bet-at-home vs. Darden Restaurants | Bet-at-home vs. Reliance Steel Aluminum | Bet-at-home vs. Q2M Managementberatung AG |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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