Correlation Between Netflix and Popular Total
Can any of the company-specific risk be diversified away by investing in both Netflix and Popular Total 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 Popular Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netflix and Popular Total Return, you can compare the effects of market volatilities on Netflix and Popular Total 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 Popular Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Popular Total.
Diversification Opportunities for Netflix and Popular Total
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Netflix and Popular is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Popular Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Popular Total Return 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 Popular Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Popular Total Return has no effect on the direction of Netflix i.e., Netflix and Popular Total go up and down completely randomly.
Pair Corralation between Netflix and Popular Total
Given the investment horizon of 90 days Netflix is expected to generate 3.91 times more return on investment than Popular Total. However, Netflix is 3.91 times more volatile than Popular Total Return. It trades about 0.12 of its potential returns per unit of risk. Popular Total Return is currently generating about 0.08 per unit of risk. If you would invest 29,041 in Netflix on September 5, 2024 and sell it today you would earn a total of 61,176 from holding Netflix or generate 210.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Netflix vs. Popular Total Return
Performance |
| Timeline |
| Netflix |
| Popular Total Return |
Netflix and Popular Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Popular Total
The main advantage of trading using opposite Netflix and Popular Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Popular Total 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 Popular Total will offset losses from the drop in Popular Total's long position.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
| Popular Total vs. Popular Total Return | Popular Total vs. Grayscale Ethereum Mini | Popular Total vs. iShares iBonds Dec | Popular Total vs. Invesco NASDAQ 100 |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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