Correlation Between NSTAR and Morgan Stanley
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By analyzing existing cross correlation between NSTAR ELEC 44 and Morgan Stanley, you can compare the effects of market volatilities on NSTAR and Morgan Stanley 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 NSTAR with a short position of Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of NSTAR and Morgan Stanley.
Diversification Opportunities for NSTAR and Morgan Stanley
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NSTAR and Morgan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding NSTAR ELEC 44 and Morgan Stanley in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley and NSTAR 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 NSTAR ELEC 44 are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley has no effect on the direction of NSTAR i.e., NSTAR and Morgan Stanley go up and down completely randomly.
Pair Corralation between NSTAR and Morgan Stanley
Assuming the 90 days trading horizon NSTAR is expected to generate 65.88 times less return on investment than Morgan Stanley. But when comparing it to its historical volatility, NSTAR ELEC 44 is 1.39 times less risky than Morgan Stanley. It trades about 0.0 of its potential returns per unit of risk. Morgan Stanley is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 8,757 in Morgan Stanley on September 12, 2024 and sell it today you would earn a total of 4,002 from holding Morgan Stanley or generate 45.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 33.47% |
| Values | Daily Returns |
NSTAR ELEC 44 vs. Morgan Stanley
Performance |
| Timeline |
| NSTAR ELEC 44 |
| Morgan Stanley |
NSTAR and Morgan Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NSTAR and Morgan Stanley
The main advantage of trading using opposite NSTAR and Morgan Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NSTAR position performs unexpectedly, Morgan Stanley 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 Morgan Stanley will offset losses from the drop in Morgan Stanley's long position.| NSTAR vs. Morgan Stanley | NSTAR vs. Kite Realty Group | NSTAR vs. Shake Shack | NSTAR vs. First Watch Restaurant |
| Morgan Stanley vs. Goldman Sachs Group | Morgan Stanley vs. Riot Blockchain | Morgan Stanley vs. Marathon Digital Holdings | Morgan Stanley vs. Applied Blockchain |
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 Stocks Directory module to find actively traded stocks across global markets.
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