Correlation Between Northern Lights and Quantex Fund
Can any of the company-specific risk be diversified away by investing in both Northern Lights and Quantex Fund 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 Northern Lights and Quantex Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Northern Lights and Quantex Fund Retail, you can compare the effects of market volatilities on Northern Lights and Quantex Fund 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 Northern Lights with a short position of Quantex Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern Lights and Quantex Fund.
Diversification Opportunities for Northern Lights and Quantex Fund
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Northern and Quantex is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Northern Lights and Quantex Fund Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantex Fund Retail and Northern Lights 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 Northern Lights are associated (or correlated) with Quantex Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantex Fund Retail has no effect on the direction of Northern Lights i.e., Northern Lights and Quantex Fund go up and down completely randomly.
Pair Corralation between Northern Lights and Quantex Fund
Assuming the 90 days horizon Northern Lights is expected to generate 1.09 times more return on investment than Quantex Fund. However, Northern Lights is 1.09 times more volatile than Quantex Fund Retail. It trades about 0.37 of its potential returns per unit of risk. Quantex Fund Retail is currently generating about 0.35 per unit of risk. If you would invest 2,846 in Northern Lights on September 4, 2024 and sell it today you would earn a total of 144.00 from holding Northern Lights or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northern Lights vs. Quantex Fund Retail
Performance |
| Timeline |
| Northern Lights |
| Quantex Fund Retail |
Northern Lights and Quantex Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern Lights and Quantex Fund
The main advantage of trading using opposite Northern Lights and Quantex Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern Lights position performs unexpectedly, Quantex Fund 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 Quantex Fund will offset losses from the drop in Quantex Fund's long position.| Northern Lights vs. Sierra Tactical Risk | Northern Lights vs. Sierra Tactical Risk | Northern Lights vs. Sierra Tactical Risk | Northern Lights vs. Sierra Tactical Risk |
| Quantex Fund vs. Muirfield Fund Retail | Quantex Fund vs. Balanced Fund Retail | Quantex Fund vs. Infrastructure Fund Retail | Quantex Fund vs. Global Opportunities Fund |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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