Correlation Between Nexstar Broadcasting and Ihuman
Can any of the company-specific risk be diversified away by investing in both Nexstar Broadcasting and Ihuman 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 Ihuman 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 Ihuman Inc, you can compare the effects of market volatilities on Nexstar Broadcasting and Ihuman 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 Ihuman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexstar Broadcasting and Ihuman.
Diversification Opportunities for Nexstar Broadcasting and Ihuman
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Nexstar and Ihuman is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Nexstar Broadcasting Group and Ihuman Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ihuman Inc 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 Ihuman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ihuman Inc has no effect on the direction of Nexstar Broadcasting i.e., Nexstar Broadcasting and Ihuman go up and down completely randomly.
Pair Corralation between Nexstar Broadcasting and Ihuman
Given the investment horizon of 90 days Nexstar Broadcasting Group is expected to generate 0.56 times more return on investment than Ihuman. However, Nexstar Broadcasting Group is 1.78 times less risky than Ihuman. It trades about 0.01 of its potential returns per unit of risk. Ihuman Inc is currently generating about -0.03 per unit of risk. If you would invest 16,984 in Nexstar Broadcasting Group on August 31, 2024 and sell it today you would earn a total of 75.00 from holding Nexstar Broadcasting Group or generate 0.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Nexstar Broadcasting Group vs. Ihuman Inc
Performance |
| Timeline |
| Nexstar Broadcasting |
| Ihuman Inc |
Nexstar Broadcasting and Ihuman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexstar Broadcasting and Ihuman
The main advantage of trading using opposite Nexstar Broadcasting and Ihuman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexstar Broadcasting position performs unexpectedly, Ihuman 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 Ihuman will offset losses from the drop in Ihuman's long position.| Nexstar Broadcasting vs. News Corp B | Nexstar Broadcasting vs. Fox Corp Class | Nexstar Broadcasting vs. AMC Networks | Nexstar Broadcasting vs. Marcus |
| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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