Correlation Between Nasdaq-100 Index and Shelton Green
Can any of the company-specific risk be diversified away by investing in both Nasdaq-100 Index and Shelton Green 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 Nasdaq-100 Index and Shelton Green into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 Index Fund and Shelton Green Alpha, you can compare the effects of market volatilities on Nasdaq-100 Index and Shelton Green 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 Nasdaq-100 Index with a short position of Shelton Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq-100 Index and Shelton Green.
Diversification Opportunities for Nasdaq-100 Index and Shelton Green
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nasdaq-100 and Shelton is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 Index Fund and Shelton Green Alpha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shelton Green Alpha and Nasdaq-100 Index 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 Nasdaq 100 Index Fund are associated (or correlated) with Shelton Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shelton Green Alpha has no effect on the direction of Nasdaq-100 Index i.e., Nasdaq-100 Index and Shelton Green go up and down completely randomly.
Pair Corralation between Nasdaq-100 Index and Shelton Green
Assuming the 90 days horizon Nasdaq 100 Index Fund is expected to generate 0.99 times more return on investment than Shelton Green. However, Nasdaq 100 Index Fund is 1.02 times less risky than Shelton Green. It trades about 0.09 of its potential returns per unit of risk. Shelton Green Alpha is currently generating about 0.01 per unit of risk. If you would invest 2,439 in Nasdaq 100 Index Fund on August 26, 2024 and sell it today you would earn a total of 1,560 from holding Nasdaq 100 Index Fund or generate 63.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nasdaq 100 Index Fund vs. Shelton Green Alpha
Performance |
| Timeline |
| Nasdaq 100 Index |
| Shelton Green Alpha |
Nasdaq-100 Index and Shelton Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq-100 Index and Shelton Green
The main advantage of trading using opposite Nasdaq-100 Index and Shelton Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq-100 Index position performs unexpectedly, Shelton Green 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 Shelton Green will offset losses from the drop in Shelton Green's long position.| Nasdaq-100 Index vs. Invesco Global Health | Nasdaq-100 Index vs. Baillie Gifford Health | Nasdaq-100 Index vs. Deutsche Health And | Nasdaq-100 Index vs. The Gabelli Healthcare |
| Shelton Green vs. Firsthand Alternative Energy | Shelton Green vs. Guinness Atkinson Alternative | Shelton Green vs. New Alternatives Fund | Shelton Green vs. Ridgeworth Innovative Growth |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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