Correlation Between Netflix and Graham
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By analyzing existing cross correlation between Netflix and Graham Holdings 575, you can compare the effects of market volatilities on Netflix and Graham 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 Graham. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Graham.
Diversification Opportunities for Netflix and Graham
Very good diversification
The 3 months correlation between Netflix and Graham is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Graham Holdings 575 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graham Holdings 575 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 Graham. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graham Holdings 575 has no effect on the direction of Netflix i.e., Netflix and Graham go up and down completely randomly.
Pair Corralation between Netflix and Graham
Given the investment horizon of 90 days Netflix is expected to generate 5.65 times more return on investment than Graham. However, Netflix is 5.65 times more volatile than Graham Holdings 575. It trades about 0.15 of its potential returns per unit of risk. Graham Holdings 575 is currently generating about 0.02 per unit of risk. If you would invest 45,200 in Netflix on September 2, 2024 and sell it today you would earn a total of 43,481 from holding Netflix or generate 96.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 63.31% |
| Values | Daily Returns |
Netflix vs. Graham Holdings 575
Performance |
| Timeline |
| Netflix |
| Graham Holdings 575 |
Netflix and Graham Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Graham
The main advantage of trading using opposite Netflix and Graham positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Graham 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 Graham will offset losses from the drop in Graham's long position.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
| Graham vs. Harmony Gold Mining | Graham vs. Parker Hannifin | Graham vs. Village Super Market | Graham vs. GMS Inc |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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