Correlation Between Netflix and Catholic Responsible
Can any of the company-specific risk be diversified away by investing in both Netflix and Catholic Responsible 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 Netflix and Catholic Responsible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netflix and Catholic Responsible Investments, you can compare the effects of market volatilities on Netflix and Catholic Responsible 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 Catholic Responsible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Catholic Responsible.
Diversification Opportunities for Netflix and Catholic Responsible
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Netflix and Catholic is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Catholic Responsible Investmen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catholic Responsible 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 Catholic Responsible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catholic Responsible has no effect on the direction of Netflix i.e., Netflix and Catholic Responsible go up and down completely randomly.
Pair Corralation between Netflix and Catholic Responsible
Given the investment horizon of 90 days Netflix is expected to generate 8.46 times more return on investment than Catholic Responsible. However, Netflix is 8.46 times more volatile than Catholic Responsible Investments. It trades about 0.57 of its potential returns per unit of risk. Catholic Responsible Investments is currently generating about 0.09 per unit of risk. If you would invest 75,551 in Netflix on September 4, 2024 and sell it today you would earn a total of 14,223 from holding Netflix or generate 18.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Netflix vs. Catholic Responsible Investmen
Performance |
| Timeline |
| Netflix |
| Catholic Responsible |
Netflix and Catholic Responsible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Catholic Responsible
The main advantage of trading using opposite Netflix and Catholic Responsible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Catholic Responsible 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 Catholic Responsible will offset losses from the drop in Catholic Responsible's long position.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |