Correlation Between Schweizerische Nationalbank and NSTAR Electric
Can any of the company-specific risk be diversified away by investing in both Schweizerische Nationalbank and NSTAR Electric 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 Schweizerische Nationalbank and NSTAR Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schweizerische Nationalbank and NSTAR Electric, you can compare the effects of market volatilities on Schweizerische Nationalbank and NSTAR Electric 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 Schweizerische Nationalbank with a short position of NSTAR Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweizerische Nationalbank and NSTAR Electric.
Diversification Opportunities for Schweizerische Nationalbank and NSTAR Electric
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Schweizerische and NSTAR is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Schweizerische Nationalbank and NSTAR Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NSTAR Electric and Schweizerische Nationalbank 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 Schweizerische Nationalbank are associated (or correlated) with NSTAR Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NSTAR Electric has no effect on the direction of Schweizerische Nationalbank i.e., Schweizerische Nationalbank and NSTAR Electric go up and down completely randomly.
Pair Corralation between Schweizerische Nationalbank and NSTAR Electric
Assuming the 90 days horizon Schweizerische Nationalbank is expected to under-perform the NSTAR Electric. But the pink sheet apears to be less risky and, when comparing its historical volatility, Schweizerische Nationalbank is 1.19 times less risky than NSTAR Electric. The pink sheet trades about -0.03 of its potential returns per unit of risk. The NSTAR Electric is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 8,980 in NSTAR Electric on September 12, 2024 and sell it today you would lose (580.00) from holding NSTAR Electric or give up 6.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 62.73% |
| Values | Daily Returns |
Schweizerische Nationalbank vs. NSTAR Electric
Performance |
| Timeline |
| Schweizerische Nationalbank |
| NSTAR Electric |
Schweizerische Nationalbank and NSTAR Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schweizerische Nationalbank and NSTAR Electric
The main advantage of trading using opposite Schweizerische Nationalbank and NSTAR Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweizerische Nationalbank position performs unexpectedly, NSTAR Electric 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 NSTAR Electric will offset losses from the drop in NSTAR Electric's long position.The idea behind Schweizerische Nationalbank and NSTAR Electric pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| NSTAR Electric vs. NRG Energy | NSTAR Electric vs. United Utilities Group | NSTAR Electric vs. Celestica | NSTAR Electric vs. United Microelectronics |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |