Correlation Between Vaughan Nelson and Natixis Sustainable
Can any of the company-specific risk be diversified away by investing in both Vaughan Nelson and Natixis Sustainable 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 Vaughan Nelson and Natixis Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vaughan Nelson Value and Natixis Sustainable Future, you can compare the effects of market volatilities on Vaughan Nelson and Natixis Sustainable 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 Vaughan Nelson with a short position of Natixis Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vaughan Nelson and Natixis Sustainable.
Diversification Opportunities for Vaughan Nelson and Natixis Sustainable
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Vaughan and Natixis is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Vaughan Nelson Value and Natixis Sustainable Future in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis Sustainable and Vaughan Nelson 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 Vaughan Nelson Value are associated (or correlated) with Natixis Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis Sustainable has no effect on the direction of Vaughan Nelson i.e., Vaughan Nelson and Natixis Sustainable go up and down completely randomly.
Pair Corralation between Vaughan Nelson and Natixis Sustainable
Assuming the 90 days horizon Vaughan Nelson Value is expected to generate 1.32 times more return on investment than Natixis Sustainable. However, Vaughan Nelson is 1.32 times more volatile than Natixis Sustainable Future. It trades about 0.11 of its potential returns per unit of risk. Natixis Sustainable Future is currently generating about 0.08 per unit of risk. If you would invest 2,034 in Vaughan Nelson Value on August 31, 2024 and sell it today you would earn a total of 920.00 from holding Vaughan Nelson Value or generate 45.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vaughan Nelson Value vs. Natixis Sustainable Future
Performance |
| Timeline |
| Vaughan Nelson Value |
| Natixis Sustainable |
Vaughan Nelson and Natixis Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vaughan Nelson and Natixis Sustainable
The main advantage of trading using opposite Vaughan Nelson and Natixis Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vaughan Nelson position performs unexpectedly, Natixis Sustainable 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 Natixis Sustainable will offset losses from the drop in Natixis Sustainable's long position.| Vaughan Nelson vs. Cref Inflation Linked Bond | Vaughan Nelson vs. Ab Bond Inflation | Vaughan Nelson vs. Lord Abbett Inflation | Vaughan Nelson vs. Aqr Managed Futures |
| Natixis Sustainable vs. Vanguard Target Retirement | Natixis Sustainable vs. American Funds 2055 | Natixis Sustainable vs. American Funds 2055 | Natixis Sustainable vs. T Rowe Price |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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