Correlation Between Nine Entertainment and Energy Technologies
Can any of the company-specific risk be diversified away by investing in both Nine Entertainment and Energy Technologies 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 Nine Entertainment and Energy Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nine Entertainment Co and Energy Technologies Limited, you can compare the effects of market volatilities on Nine Entertainment and Energy Technologies 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 Nine Entertainment with a short position of Energy Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nine Entertainment and Energy Technologies.
Diversification Opportunities for Nine Entertainment and Energy Technologies
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nine and Energy is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Nine Entertainment Co and Energy Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Technologies and Nine Entertainment 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 Nine Entertainment Co are associated (or correlated) with Energy Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Technologies has no effect on the direction of Nine Entertainment i.e., Nine Entertainment and Energy Technologies go up and down completely randomly.
Pair Corralation between Nine Entertainment and Energy Technologies
Assuming the 90 days trading horizon Nine Entertainment Co is expected to generate 0.49 times more return on investment than Energy Technologies. However, Nine Entertainment Co is 2.05 times less risky than Energy Technologies. It trades about 0.16 of its potential returns per unit of risk. Energy Technologies Limited is currently generating about 0.05 per unit of risk. If you would invest 111.00 in Nine Entertainment Co on November 7, 2024 and sell it today you would earn a total of 18.00 from holding Nine Entertainment Co or generate 16.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nine Entertainment Co vs. Energy Technologies Limited
Performance |
| Timeline |
| Nine Entertainment |
| Energy Technologies |
Nine Entertainment and Energy Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nine Entertainment and Energy Technologies
The main advantage of trading using opposite Nine Entertainment and Energy Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nine Entertainment position performs unexpectedly, Energy Technologies 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 Energy Technologies will offset losses from the drop in Energy Technologies' long position.| Nine Entertainment vs. Fisher Paykel Healthcare | Nine Entertainment vs. Macquarie Technology Group | Nine Entertainment vs. Kip McGrath Education | Nine Entertainment vs. Dug Technology |
| Energy Technologies vs. Hotel Property Investments | Energy Technologies vs. Dynamic Drill And | Energy Technologies vs. Gtn | Energy Technologies vs. Nufarm |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |