Correlation Between Nexstar Broadcasting and First Republic
Can any of the company-specific risk be diversified away by investing in both Nexstar Broadcasting and First Republic 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 Nexstar Broadcasting and First Republic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nexstar Broadcasting Group and First Republic Bank, you can compare the effects of market volatilities on Nexstar Broadcasting and First Republic 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 Nexstar Broadcasting with a short position of First Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexstar Broadcasting and First Republic.
Diversification Opportunities for Nexstar Broadcasting and First Republic
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nexstar and First is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Nexstar Broadcasting Group and First Republic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Republic Bank and Nexstar Broadcasting 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 Nexstar Broadcasting Group are associated (or correlated) with First Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Republic Bank has no effect on the direction of Nexstar Broadcasting i.e., Nexstar Broadcasting and First Republic go up and down completely randomly.
Pair Corralation between Nexstar Broadcasting and First Republic
If you would invest 15,306 in Nexstar Broadcasting Group on September 12, 2024 and sell it today you would earn a total of 1,094 from holding Nexstar Broadcasting Group or generate 7.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.3% |
| Values | Daily Returns |
Nexstar Broadcasting Group vs. First Republic Bank
Performance |
| Timeline |
| Nexstar Broadcasting |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Nexstar Broadcasting and First Republic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexstar Broadcasting and First Republic
The main advantage of trading using opposite Nexstar Broadcasting and First Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexstar Broadcasting position performs unexpectedly, First Republic 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 First Republic will offset losses from the drop in First Republic's long position.| Nexstar Broadcasting vs. News Corp B | Nexstar Broadcasting vs. Fox Corp Class | Nexstar Broadcasting vs. Liberty Media | Nexstar Broadcasting vs. AMC Networks |
| First Republic vs. Ameriprise Financial | First Republic vs. Nexstar Broadcasting Group | First Republic vs. Artisan Partners Asset | First Republic vs. United Airlines Holdings |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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