Correlation Between Netflix and Miller Income
Can any of the company-specific risk be diversified away by investing in both Netflix and Miller Income 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 Miller Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netflix and Miller Income Fund, you can compare the effects of market volatilities on Netflix and Miller Income 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 Miller Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Miller Income.
Diversification Opportunities for Netflix and Miller Income
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Netflix and Miller is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Miller Income Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Miller Income 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 Miller Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Miller Income has no effect on the direction of Netflix i.e., Netflix and Miller Income go up and down completely randomly.
Pair Corralation between Netflix and Miller Income
Given the investment horizon of 90 days Netflix is expected to generate 1.7 times more return on investment than Miller Income. However, Netflix is 1.7 times more volatile than Miller Income Fund. It trades about 0.24 of its potential returns per unit of risk. Miller Income Fund is currently generating about 0.24 per unit of risk. If you would invest 68,680 in Netflix on September 12, 2024 and sell it today you would earn a total of 22,655 from holding Netflix or generate 32.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Netflix vs. Miller Income Fund
Performance |
| Timeline |
| Netflix |
| Miller Income |
Netflix and Miller Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Miller Income
The main advantage of trading using opposite Netflix and Miller Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Miller Income 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 Miller Income will offset losses from the drop in Miller Income's long position.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
| Miller Income vs. Amg River Road | Miller Income vs. Queens Road Small | Miller Income vs. Victory Rs Partners | Miller Income vs. Fpa Queens Road |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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