Correlation Between Nike and COMCAST
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By analyzing existing cross correlation between Nike Inc and COMCAST PORATION, you can compare the effects of market volatilities on Nike and COMCAST 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 Nike with a short position of COMCAST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nike and COMCAST.
Diversification Opportunities for Nike and COMCAST
Very weak diversification
The 3 months correlation between Nike and COMCAST is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Nike Inc and COMCAST PORATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMCAST PORATION and Nike 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 Nike Inc are associated (or correlated) with COMCAST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMCAST PORATION has no effect on the direction of Nike i.e., Nike and COMCAST go up and down completely randomly.
Pair Corralation between Nike and COMCAST
Considering the 90-day investment horizon Nike Inc is expected to generate 3.41 times more return on investment than COMCAST. However, Nike is 3.41 times more volatile than COMCAST PORATION. It trades about 0.01 of its potential returns per unit of risk. COMCAST PORATION is currently generating about -0.19 per unit of risk. If you would invest 7,840 in Nike Inc on August 30, 2024 and sell it today you would lose (6.00) from holding Nike Inc or give up 0.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Nike Inc vs. COMCAST PORATION
Performance |
| Timeline |
| Nike Inc |
| COMCAST PORATION |
Nike and COMCAST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nike and COMCAST
The main advantage of trading using opposite Nike and COMCAST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nike position performs unexpectedly, COMCAST 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 COMCAST will offset losses from the drop in COMCAST's long position.The idea behind Nike Inc and COMCAST PORATION pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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