Correlation Between Neogen and NIP Group
Can any of the company-specific risk be diversified away by investing in both Neogen and NIP Group 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 Neogen and NIP Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neogen and NIP Group American, you can compare the effects of market volatilities on Neogen and NIP Group 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 Neogen with a short position of NIP Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neogen and NIP Group.
Diversification Opportunities for Neogen and NIP Group
Significant diversification
The 3 months correlation between Neogen and NIP is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Neogen and NIP Group American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NIP Group American and Neogen 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 Neogen are associated (or correlated) with NIP Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NIP Group American has no effect on the direction of Neogen i.e., Neogen and NIP Group go up and down completely randomly.
Pair Corralation between Neogen and NIP Group
Given the investment horizon of 90 days Neogen is expected to generate 32.84 times less return on investment than NIP Group. But when comparing it to its historical volatility, Neogen is 3.67 times less risky than NIP Group. It trades about 0.0 of its potential returns per unit of risk. NIP Group American is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 902.00 in NIP Group American on September 13, 2024 and sell it today you would lose (189.00) from holding NIP Group American or give up 20.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 19.64% |
| Values | Daily Returns |
Neogen vs. NIP Group American
Performance |
| Timeline |
| Neogen |
| NIP Group American |
Neogen and NIP Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neogen and NIP Group
The main advantage of trading using opposite Neogen and NIP Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neogen position performs unexpectedly, NIP Group 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 NIP Group will offset losses from the drop in NIP Group's long position.| Neogen vs. Avita Medical | Neogen vs. Sight Sciences | Neogen vs. Treace Medical Concepts | Neogen vs. Neuropace |
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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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