Correlation Between NEOS ETF and Unity Wealth
Can any of the company-specific risk be diversified away by investing in both NEOS ETF and Unity Wealth 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 NEOS ETF and Unity Wealth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NEOS ETF Trust and Unity Wealth Partners, you can compare the effects of market volatilities on NEOS ETF and Unity Wealth 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 NEOS ETF with a short position of Unity Wealth. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEOS ETF and Unity Wealth.
Diversification Opportunities for NEOS ETF and Unity Wealth
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NEOS and Unity is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding NEOS ETF Trust and Unity Wealth Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unity Wealth Partners and NEOS ETF 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 NEOS ETF Trust are associated (or correlated) with Unity Wealth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unity Wealth Partners has no effect on the direction of NEOS ETF i.e., NEOS ETF and Unity Wealth go up and down completely randomly.
Pair Corralation between NEOS ETF and Unity Wealth
Given the investment horizon of 90 days NEOS ETF is expected to generate 3.36 times less return on investment than Unity Wealth. But when comparing it to its historical volatility, NEOS ETF Trust is 1.02 times less risky than Unity Wealth. It trades about 0.07 of its potential returns per unit of risk. Unity Wealth Partners is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 2,076 in Unity Wealth Partners on August 30, 2024 and sell it today you would earn a total of 92.00 from holding Unity Wealth Partners or generate 4.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NEOS ETF Trust vs. Unity Wealth Partners
Performance |
| Timeline |
| NEOS ETF Trust |
| Unity Wealth Partners |
NEOS ETF and Unity Wealth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEOS ETF and Unity Wealth
The main advantage of trading using opposite NEOS ETF and Unity Wealth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEOS ETF position performs unexpectedly, Unity Wealth 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 Unity Wealth will offset losses from the drop in Unity Wealth's long position.| NEOS ETF vs. Global X Russell | NEOS ETF vs. Global X SP | NEOS ETF vs. Global X NASDAQ | NEOS ETF vs. Amplify CWP Enhanced |
| Unity Wealth vs. Global X SP | Unity Wealth vs. Amplify CWP Enhanced | Unity Wealth vs. Global X Russell | Unity Wealth vs. JPMorgan Nasdaq Equity |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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