Correlation Between NiSource and Sezzle Common
Can any of the company-specific risk be diversified away by investing in both NiSource and Sezzle Common 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 NiSource and Sezzle Common into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NiSource and Sezzle Common Stock, you can compare the effects of market volatilities on NiSource and Sezzle Common 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 NiSource with a short position of Sezzle Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of NiSource and Sezzle Common.
Diversification Opportunities for NiSource and Sezzle Common
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NiSource and Sezzle is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding NiSource and Sezzle Common Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sezzle Common Stock and NiSource 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 NiSource are associated (or correlated) with Sezzle Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sezzle Common Stock has no effect on the direction of NiSource i.e., NiSource and Sezzle Common go up and down completely randomly.
Pair Corralation between NiSource and Sezzle Common
Allowing for the 90-day total investment horizon NiSource is expected to generate 11.8 times less return on investment than Sezzle Common. But when comparing it to its historical volatility, NiSource is 10.3 times less risky than Sezzle Common. It trades about 0.16 of its potential returns per unit of risk. Sezzle Common Stock is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,217 in Sezzle Common Stock on September 4, 2024 and sell it today you would earn a total of 37,187 from holding Sezzle Common Stock or generate 3055.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NiSource vs. Sezzle Common Stock
Performance |
| Timeline |
| NiSource |
| Sezzle Common Stock |
NiSource and Sezzle Common Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NiSource and Sezzle Common
The main advantage of trading using opposite NiSource and Sezzle Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NiSource position performs unexpectedly, Sezzle Common 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 Sezzle Common will offset losses from the drop in Sezzle Common's long position.| NiSource vs. NewJersey Resources | NiSource vs. Northwest Natural Gas | NiSource vs. UGI Corporation | NiSource vs. Spire Inc |
| Sezzle Common vs. CapitaLand Investment Limited | Sezzle Common vs. Highway Holdings Limited | Sezzle Common vs. Merit Medical Systems | Sezzle Common vs. Esperion Therapeutics |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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