Correlation Between TRANSCANADA and Nasdaq
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By analyzing existing cross correlation between TRANSCANADA PIPELINES LTD and Nasdaq Inc, you can compare the effects of market volatilities on TRANSCANADA and Nasdaq 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 TRANSCANADA with a short position of Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRANSCANADA and Nasdaq.
Diversification Opportunities for TRANSCANADA and Nasdaq
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between TRANSCANADA and Nasdaq is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding TRANSCANADA PIPELINES LTD and Nasdaq Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq Inc and TRANSCANADA 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 TRANSCANADA PIPELINES LTD are associated (or correlated) with Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq Inc has no effect on the direction of TRANSCANADA i.e., TRANSCANADA and Nasdaq go up and down completely randomly.
Pair Corralation between TRANSCANADA and Nasdaq
Assuming the 90 days trading horizon TRANSCANADA is expected to generate 8.08 times less return on investment than Nasdaq. But when comparing it to its historical volatility, TRANSCANADA PIPELINES LTD is 1.21 times less risky than Nasdaq. It trades about 0.02 of its potential returns per unit of risk. Nasdaq Inc is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 4,981 in Nasdaq Inc on September 2, 2024 and sell it today you would earn a total of 3,318 from holding Nasdaq Inc or generate 66.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
TRANSCANADA PIPELINES LTD vs. Nasdaq Inc
Performance |
| Timeline |
| TRANSCANADA PIPELINES LTD |
| Nasdaq Inc |
TRANSCANADA and Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TRANSCANADA and Nasdaq
The main advantage of trading using opposite TRANSCANADA and Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TRANSCANADA position performs unexpectedly, Nasdaq 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 will offset losses from the drop in Nasdaq's long position.| TRANSCANADA vs. AEP TEX INC | TRANSCANADA vs. US BANK NATIONAL | TRANSCANADA vs. Bank of America | TRANSCANADA vs. GE Aerospace |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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