Correlation Between Videolocity International and NRG Energy
Can any of the company-specific risk be diversified away by investing in both Videolocity International and NRG Energy 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 Videolocity International and NRG Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Videolocity International and NRG Energy, you can compare the effects of market volatilities on Videolocity International and NRG Energy 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 Videolocity International with a short position of NRG Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Videolocity International and NRG Energy.
Diversification Opportunities for Videolocity International and NRG Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Videolocity and NRG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Videolocity International and NRG Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NRG Energy and Videolocity International 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 Videolocity International are associated (or correlated) with NRG Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NRG Energy has no effect on the direction of Videolocity International i.e., Videolocity International and NRG Energy go up and down completely randomly.
Pair Corralation between Videolocity International and NRG Energy
If you would invest 4,639 in NRG Energy on September 2, 2024 and sell it today you would earn a total of 5,522 from holding NRG Energy or generate 119.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Videolocity International vs. NRG Energy
Performance |
| Timeline |
| Videolocity International |
| NRG Energy |
Videolocity International and NRG Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Videolocity International and NRG Energy
The main advantage of trading using opposite Videolocity International and NRG Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Videolocity International position performs unexpectedly, NRG Energy 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 NRG Energy will offset losses from the drop in NRG Energy's long position.| Videolocity International vs. Wialan Technologies | Videolocity International vs. TPT Global Tech | Videolocity International vs. AAP Inc | Videolocity International vs. Impinj Inc |
| NRG Energy vs. TransAlta Corp | NRG Energy vs. Kenon Holdings | NRG Energy vs. Pampa Energia SA | NRG Energy vs. AGL Energy |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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