Correlation Between Nationwide International and Nationwide Geneva
Can any of the company-specific risk be diversified away by investing in both Nationwide International and Nationwide Geneva 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 Nationwide International and Nationwide Geneva into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide International Index and Nationwide Geneva Mid, you can compare the effects of market volatilities on Nationwide International and Nationwide Geneva 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 Nationwide International with a short position of Nationwide Geneva. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide International and Nationwide Geneva.
Diversification Opportunities for Nationwide International and Nationwide Geneva
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NATIONWIDE and Nationwide is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide International Index and Nationwide Geneva Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Geneva Mid and Nationwide 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 Nationwide International Index are associated (or correlated) with Nationwide Geneva. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Geneva Mid has no effect on the direction of Nationwide International i.e., Nationwide International and Nationwide Geneva go up and down completely randomly.
Pair Corralation between Nationwide International and Nationwide Geneva
Assuming the 90 days horizon Nationwide International Index is expected to generate 0.94 times more return on investment than Nationwide Geneva. However, Nationwide International Index is 1.06 times less risky than Nationwide Geneva. It trades about 0.26 of its potential returns per unit of risk. Nationwide Geneva Mid is currently generating about -0.18 per unit of risk. If you would invest 898.00 in Nationwide International Index on November 28, 2024 and sell it today you would earn a total of 36.00 from holding Nationwide International Index or generate 4.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nationwide International Index vs. Nationwide Geneva Mid
Performance |
| Timeline |
| Nationwide International |
| Nationwide Geneva Mid |
Nationwide International and Nationwide Geneva Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide International and Nationwide Geneva
The main advantage of trading using opposite Nationwide International and Nationwide Geneva positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide International position performs unexpectedly, Nationwide Geneva 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 Nationwide Geneva will offset losses from the drop in Nationwide Geneva's long position.| Nationwide International vs. Msift High Yield | Nationwide International vs. Gmo High Yield | Nationwide International vs. Mainstay High Yield | Nationwide International vs. Siit High Yield |
| Nationwide Geneva vs. Blackrock Financial Institutions | Nationwide Geneva vs. Fidelity Advisor Financial | Nationwide Geneva vs. Icon Financial Fund | Nationwide Geneva vs. Gabelli Global Financial |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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