Correlation Between NRG Energy and Yanlord Land
Can any of the company-specific risk be diversified away by investing in both NRG Energy and Yanlord Land 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 Yanlord Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NRG Energy and Yanlord Land Group, you can compare the effects of market volatilities on NRG Energy and Yanlord Land 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 Yanlord Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of NRG Energy and Yanlord Land.
Diversification Opportunities for NRG Energy and Yanlord Land
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NRG and Yanlord is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding NRG Energy and Yanlord Land Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yanlord Land Group 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 Yanlord Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yanlord Land Group has no effect on the direction of NRG Energy i.e., NRG Energy and Yanlord Land go up and down completely randomly.
Pair Corralation between NRG Energy and Yanlord Land
If you would invest 9,707 in NRG Energy on November 28, 2024 and sell it today you would earn a total of 1,626 from holding NRG Energy or generate 16.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
NRG Energy vs. Yanlord Land Group
Performance |
| Timeline |
| NRG Energy |
| Yanlord Land Group |
NRG Energy and Yanlord Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NRG Energy and Yanlord Land
The main advantage of trading using opposite NRG Energy and Yanlord Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NRG Energy position performs unexpectedly, Yanlord Land 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 Yanlord Land will offset losses from the drop in Yanlord Land's long position.| NRG Energy vs. TransAlta Corp | NRG Energy vs. Kenon Holdings | NRG Energy vs. Pampa Energia SA | NRG Energy vs. AGL Energy |
| Yanlord Land vs. Best Buy Co | Yanlord Land vs. Norfolk Southern | Yanlord Land vs. JD Sports Fashion | Yanlord Land vs. Academy Sports Outdoors |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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