Correlation Between PNM Old and Consolidated Edison
Can any of the company-specific risk be diversified away by investing in both PNM Old and Consolidated Edison 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 PNM Old and Consolidated Edison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PNM Old and Consolidated Edison, you can compare the effects of market volatilities on PNM Old and Consolidated Edison 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 PNM Old with a short position of Consolidated Edison. Check out your portfolio center. Please also check ongoing floating volatility patterns of PNM Old and Consolidated Edison.
Diversification Opportunities for PNM Old and Consolidated Edison
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PNM and Consolidated is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PNM Old and Consolidated Edison in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Consolidated Edison and PNM Old 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 PNM Old are associated (or correlated) with Consolidated Edison. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Consolidated Edison has no effect on the direction of PNM Old i.e., PNM Old and Consolidated Edison go up and down completely randomly.
Pair Corralation between PNM Old and Consolidated Edison
If you would invest 9,365 in Consolidated Edison on November 18, 2024 and sell it today you would earn a total of 127.00 from holding Consolidated Edison or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
PNM Old vs. Consolidated Edison
Performance |
| Timeline |
| PNM Old |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Consolidated Edison |
PNM Old and Consolidated Edison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PNM Old and Consolidated Edison
The main advantage of trading using opposite PNM Old and Consolidated Edison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PNM Old position performs unexpectedly, Consolidated Edison 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 Consolidated Edison will offset losses from the drop in Consolidated Edison's long position.| PNM Old vs. Portland General Electric | PNM Old vs. MGE Energy | PNM Old vs. CMS Energy | PNM Old vs. OGE Energy |
| Consolidated Edison vs. Duke Energy | Consolidated Edison vs. Dominion Energy | Consolidated Edison vs. American Electric Power | Consolidated Edison vs. Nextera Energy |
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.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |