Correlation Between Naked Wines and Anterix
Can any of the company-specific risk be diversified away by investing in both Naked Wines and Anterix 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 Naked Wines and Anterix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Naked Wines plc and Anterix, you can compare the effects of market volatilities on Naked Wines and Anterix 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 Naked Wines with a short position of Anterix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Naked Wines and Anterix.
Diversification Opportunities for Naked Wines and Anterix
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Naked and Anterix is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Naked Wines plc and Anterix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anterix and Naked Wines 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 Naked Wines plc are associated (or correlated) with Anterix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anterix has no effect on the direction of Naked Wines i.e., Naked Wines and Anterix go up and down completely randomly.
Pair Corralation between Naked Wines and Anterix
Assuming the 90 days horizon Naked Wines plc is expected to under-perform the Anterix. In addition to that, Naked Wines is 1.57 times more volatile than Anterix. It trades about -0.22 of its total potential returns per unit of risk. Anterix is currently generating about -0.05 per unit of volatility. If you would invest 3,005 in Anterix on November 2, 2024 and sell it today you would lose (104.00) from holding Anterix or give up 3.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.48% |
| Values | Daily Returns |
Naked Wines plc vs. Anterix
Performance |
| Timeline |
| Naked Wines plc |
| Anterix |
Naked Wines and Anterix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Naked Wines and Anterix
The main advantage of trading using opposite Naked Wines and Anterix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Naked Wines position performs unexpectedly, Anterix 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 Anterix will offset losses from the drop in Anterix's long position.| Naked Wines vs. Pernod Ricard SA | Naked Wines vs. Naked Wines plc | Naked Wines vs. Crimson Wine | Naked Wines vs. Brown Forman |
| Anterix vs. Shenandoah Telecommunications Co | Anterix vs. Liberty Broadband Corp | Anterix vs. Ooma Inc | Anterix vs. IDT Corporation |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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