Correlation Between Banking Fund and Nasdaq 100
Can any of the company-specific risk be diversified away by investing in both Banking Fund and Nasdaq 100 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 Banking Fund and Nasdaq 100 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banking Fund Class and Nasdaq 100 2x Strategy, you can compare the effects of market volatilities on Banking Fund and Nasdaq 100 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 Banking Fund with a short position of Nasdaq 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banking Fund and Nasdaq 100.
Diversification Opportunities for Banking Fund and Nasdaq 100
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Banking and Nasdaq is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Banking Fund Class and Nasdaq 100 2x Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 2x and Banking Fund 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 Banking Fund Class are associated (or correlated) with Nasdaq 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 2x has no effect on the direction of Banking Fund i.e., Banking Fund and Nasdaq 100 go up and down completely randomly.
Pair Corralation between Banking Fund and Nasdaq 100
If you would invest 53,816 in Nasdaq 100 2x Strategy on August 24, 2024 and sell it today you would earn a total of 2,863 from holding Nasdaq 100 2x Strategy or generate 5.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Banking Fund Class vs. Nasdaq 100 2x Strategy
Performance |
| Timeline |
| Banking Fund Class |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Nasdaq 100 2x |
Banking Fund and Nasdaq 100 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banking Fund and Nasdaq 100
The main advantage of trading using opposite Banking Fund and Nasdaq 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banking Fund position performs unexpectedly, Nasdaq 100 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 Nasdaq 100 will offset losses from the drop in Nasdaq 100's long position.| Banking Fund vs. Prudential Core Conservative | Banking Fund vs. Delaware Limited Term Diversified | Banking Fund vs. Fidelity Advisor Diversified | Banking Fund vs. Tiaa Cref Lifestyle Conservative |
| Nasdaq 100 vs. Sp 500 2x | Nasdaq 100 vs. Inverse Nasdaq 100 2x | Nasdaq 100 vs. Inverse Sp 500 | Nasdaq 100 vs. Ultra Nasdaq 100 Profunds |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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