Correlation Between Next Generation and First Colombia
Can any of the company-specific risk be diversified away by investing in both Next Generation and First Colombia 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 Next Generation and First Colombia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Next Generation Management and First Colombia Gold, you can compare the effects of market volatilities on Next Generation and First Colombia 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 Next Generation with a short position of First Colombia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Next Generation and First Colombia.
Diversification Opportunities for Next Generation and First Colombia
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Next and First is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Next Generation Management and First Colombia Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Colombia Gold and Next Generation 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 Next Generation Management are associated (or correlated) with First Colombia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Colombia Gold has no effect on the direction of Next Generation i.e., Next Generation and First Colombia go up and down completely randomly.
Pair Corralation between Next Generation and First Colombia
Given the investment horizon of 90 days Next Generation Management is expected to under-perform the First Colombia. But the pink sheet apears to be less risky and, when comparing its historical volatility, Next Generation Management is 17.94 times less risky than First Colombia. The pink sheet trades about -0.15 of its potential returns per unit of risk. The First Colombia Gold is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 0.01 in First Colombia Gold on September 1, 2024 and sell it today you would earn a total of 0.00 from holding First Colombia Gold or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Next Generation Management vs. First Colombia Gold
Performance |
| Timeline |
| Next Generation Mana |
| First Colombia Gold |
Next Generation and First Colombia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Next Generation and First Colombia
The main advantage of trading using opposite Next Generation and First Colombia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Next Generation position performs unexpectedly, First Colombia 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 First Colombia will offset losses from the drop in First Colombia's long position.| Next Generation vs. The BC Bud | Next Generation vs. Amexdrug | Next Generation vs. Nutranomics | Next Generation vs. Aion Therapeutic |
| First Colombia vs. American Leisure Holdings | First Colombia vs. Supurva Healthcare Group | First Colombia vs. China Health Management | First Colombia vs. Embrace Change Acquisition |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |