Correlation Between Ninepoint High and NBI High
Can any of the company-specific risk be diversified away by investing in both Ninepoint High and NBI High 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 Ninepoint High and NBI High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ninepoint High Interest and NBI High Yield, you can compare the effects of market volatilities on Ninepoint High and NBI High 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 Ninepoint High with a short position of NBI High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ninepoint High and NBI High.
Diversification Opportunities for Ninepoint High and NBI High
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ninepoint and NBI is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Ninepoint High Interest and NBI High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBI High Yield and Ninepoint High 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 Ninepoint High Interest are associated (or correlated) with NBI High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBI High Yield has no effect on the direction of Ninepoint High i.e., Ninepoint High and NBI High go up and down completely randomly.
Pair Corralation between Ninepoint High and NBI High
Assuming the 90 days trading horizon Ninepoint High is expected to generate 9.27 times less return on investment than NBI High. But when comparing it to its historical volatility, Ninepoint High Interest is 5.14 times less risky than NBI High. It trades about 0.07 of its potential returns per unit of risk. NBI High Yield is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 2,050 in NBI High Yield on September 3, 2024 and sell it today you would earn a total of 147.00 from holding NBI High Yield or generate 7.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ninepoint High Interest vs. NBI High Yield
Performance |
| Timeline |
| Ninepoint High Interest |
| NBI High Yield |
Ninepoint High and NBI High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ninepoint High and NBI High
The main advantage of trading using opposite Ninepoint High and NBI High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ninepoint High position performs unexpectedly, NBI High 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 NBI High will offset losses from the drop in NBI High's long position.| Ninepoint High vs. Ninepoint Bitcoin ETF | Ninepoint High vs. Ninepoint Energy | Ninepoint High vs. Ninepoint Bitcoin ETF | Ninepoint High vs. Ninepoint Web3 Innovators |
| NBI High vs. NBI Unconstrained Fixed | NBI High vs. NBI Active Canadian | NBI High vs. NBI Sustainable Canadian | NBI High vs. Picton Mahoney Fortified |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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