Correlation Between Netflix and Nanjing Yunhai
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By analyzing existing cross correlation between Netflix and Nanjing Yunhai Special, you can compare the effects of market volatilities on Netflix and Nanjing Yunhai 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 Netflix with a short position of Nanjing Yunhai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Nanjing Yunhai.
Diversification Opportunities for Netflix and Nanjing Yunhai
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Netflix and Nanjing is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Nanjing Yunhai Special in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Yunhai Special and Netflix 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 Netflix are associated (or correlated) with Nanjing Yunhai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Yunhai Special has no effect on the direction of Netflix i.e., Netflix and Nanjing Yunhai go up and down completely randomly.
Pair Corralation between Netflix and Nanjing Yunhai
Given the investment horizon of 90 days Netflix is expected to generate 1.34 times less return on investment than Nanjing Yunhai. But when comparing it to its historical volatility, Netflix is 2.44 times less risky than Nanjing Yunhai. It trades about 0.41 of its potential returns per unit of risk. Nanjing Yunhai Special is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,116 in Nanjing Yunhai Special on September 13, 2024 and sell it today you would earn a total of 215.00 from holding Nanjing Yunhai Special or generate 19.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Netflix vs. Nanjing Yunhai Special
Performance |
| Timeline |
| Netflix |
| Nanjing Yunhai Special |
Netflix and Nanjing Yunhai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Nanjing Yunhai
The main advantage of trading using opposite Netflix and Nanjing Yunhai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Nanjing Yunhai 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 Nanjing Yunhai will offset losses from the drop in Nanjing Yunhai's long position.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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