Correlation Between Netflix and Fjordland Exploration
Can any of the company-specific risk be diversified away by investing in both Netflix and Fjordland Exploration 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 Fjordland Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netflix and Fjordland Exploration, you can compare the effects of market volatilities on Netflix and Fjordland Exploration 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 Fjordland Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Fjordland Exploration.
Diversification Opportunities for Netflix and Fjordland Exploration
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Netflix and Fjordland is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Fjordland Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fjordland Exploration 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 Fjordland Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fjordland Exploration has no effect on the direction of Netflix i.e., Netflix and Fjordland Exploration go up and down completely randomly.
Pair Corralation between Netflix and Fjordland Exploration
Given the investment horizon of 90 days Netflix is expected to under-perform the Fjordland Exploration. But the etf apears to be less risky and, when comparing its historical volatility, Netflix is 10.66 times less risky than Fjordland Exploration. The etf trades about -0.08 of its potential returns per unit of risk. The Fjordland Exploration is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1.00 in Fjordland Exploration on January 14, 2025 and sell it today you would earn a total of 0.50 from holding Fjordland Exploration or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.67% |
| Values | Daily Returns |
Netflix vs. Fjordland Exploration
Performance |
| Timeline |
| Netflix |
| Fjordland Exploration |
Netflix and Fjordland Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Fjordland Exploration
The main advantage of trading using opposite Netflix and Fjordland Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Fjordland Exploration 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 Fjordland Exploration will offset losses from the drop in Fjordland Exploration'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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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