Correlation Between NRG Energy and Concorde Gaming
Can any of the company-specific risk be diversified away by investing in both NRG Energy and Concorde Gaming 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 NRG Energy and Concorde Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NRG Energy and Concorde Gaming, you can compare the effects of market volatilities on NRG Energy and Concorde Gaming 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 NRG Energy with a short position of Concorde Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of NRG Energy and Concorde Gaming.
Diversification Opportunities for NRG Energy and Concorde Gaming
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NRG and Concorde is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NRG Energy and Concorde Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concorde Gaming and NRG Energy 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 NRG Energy are associated (or correlated) with Concorde Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concorde Gaming has no effect on the direction of NRG Energy i.e., NRG Energy and Concorde Gaming go up and down completely randomly.
Pair Corralation between NRG Energy and Concorde Gaming
If you would invest 8,833 in NRG Energy on August 27, 2024 and sell it today you would earn a total of 715.00 from holding NRG Energy or generate 8.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NRG Energy vs. Concorde Gaming
Performance |
| Timeline |
| NRG Energy |
| Concorde Gaming |
NRG Energy and Concorde Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NRG Energy and Concorde Gaming
The main advantage of trading using opposite NRG Energy and Concorde Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NRG Energy position performs unexpectedly, Concorde Gaming 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 Concorde Gaming will offset losses from the drop in Concorde Gaming's long position.| NRG Energy vs. TransAlta Corp | NRG Energy vs. Kenon Holdings | NRG Energy vs. Pampa Energia SA | NRG Energy vs. AGL Energy |
| Concorde Gaming vs. FitLife Brands, Common | Concorde Gaming vs. HUMANA INC | Concorde Gaming vs. SCOR PK | Concorde Gaming vs. Aquagold International |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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