Correlation Between Nike and 824348BP0
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By analyzing existing cross correlation between Nike Inc and SHW 29 15 MAR 52, you can compare the effects of market volatilities on Nike and 824348BP0 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 824348BP0. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nike and 824348BP0.
Diversification Opportunities for Nike and 824348BP0
Poor diversification
The 3 months correlation between Nike and 824348BP0 is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Nike Inc and SHW 29 15 MAR 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHW 29 15 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 824348BP0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHW 29 15 has no effect on the direction of Nike i.e., Nike and 824348BP0 go up and down completely randomly.
Pair Corralation between Nike and 824348BP0
Considering the 90-day investment horizon Nike is expected to generate 3.33 times less return on investment than 824348BP0. But when comparing it to its historical volatility, Nike Inc is 1.75 times less risky than 824348BP0. It trades about 0.1 of its potential returns per unit of risk. SHW 29 15 MAR 52 is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 6,326 in SHW 29 15 MAR 52 on September 13, 2024 and sell it today you would earn a total of 602.00 from holding SHW 29 15 MAR 52 or generate 9.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 86.36% |
| Values | Daily Returns |
Nike Inc vs. SHW 29 15 MAR 52
Performance |
| Timeline |
| Nike Inc |
| SHW 29 15 |
Nike and 824348BP0 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nike and 824348BP0
The main advantage of trading using opposite Nike and 824348BP0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nike position performs unexpectedly, 824348BP0 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 824348BP0 will offset losses from the drop in 824348BP0's long position.The idea behind Nike Inc and SHW 29 15 MAR 52 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.| 824348BP0 vs. United Parks Resorts | 824348BP0 vs. Academy Sports Outdoors | 824348BP0 vs. JD Sports Fashion | 824348BP0 vs. BRP 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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