Correlation Between Shelton Green and Nasdaq-100 Index
Can any of the company-specific risk be diversified away by investing in both Shelton Green and Nasdaq-100 Index 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 Shelton Green and Nasdaq-100 Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shelton Green Alpha and Nasdaq 100 Index Fund, you can compare the effects of market volatilities on Shelton Green and Nasdaq-100 Index 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 Shelton Green with a short position of Nasdaq-100 Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelton Green and Nasdaq-100 Index.
Diversification Opportunities for Shelton Green and Nasdaq-100 Index
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shelton and Nasdaq-100 is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shelton Green Alpha and Nasdaq 100 Index Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 Index and Shelton Green 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 Shelton Green Alpha are associated (or correlated) with Nasdaq-100 Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 Index has no effect on the direction of Shelton Green i.e., Shelton Green and Nasdaq-100 Index go up and down completely randomly.
Pair Corralation between Shelton Green and Nasdaq-100 Index
Assuming the 90 days horizon Shelton Green is expected to generate 1.37 times less return on investment than Nasdaq-100 Index. In addition to that, Shelton Green is 1.02 times more volatile than Nasdaq 100 Index Fund. It trades about 0.06 of its total potential returns per unit of risk. Nasdaq 100 Index Fund is currently generating about 0.08 per unit of volatility. If you would invest 3,178 in Nasdaq 100 Index Fund on August 29, 2024 and sell it today you would earn a total of 991.00 from holding Nasdaq 100 Index Fund or generate 31.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shelton Green Alpha vs. Nasdaq 100 Index Fund
Performance |
| Timeline |
| Shelton Green Alpha |
| Nasdaq 100 Index |
Shelton Green and Nasdaq-100 Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shelton Green and Nasdaq-100 Index
The main advantage of trading using opposite Shelton Green and Nasdaq-100 Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shelton Green position performs unexpectedly, Nasdaq-100 Index 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 Nasdaq-100 Index will offset losses from the drop in Nasdaq-100 Index's long position.| Shelton Green vs. Firsthand Alternative Energy | Shelton Green vs. Guinness Atkinson Alternative | Shelton Green vs. New Alternatives Fund | Shelton Green vs. Ridgeworth Innovative Growth |
| Nasdaq-100 Index vs. Nasdaq 100 Index Fund | Nasdaq-100 Index vs. Nasdaq 100 Index Fund | Nasdaq-100 Index vs. Fidelity Zero Large | Nasdaq-100 Index vs. Vanguard Russell 2000 |
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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