Correlation Between Wex and Nutanix
Can any of the company-specific risk be diversified away by investing in both Wex and Nutanix 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 Wex and Nutanix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wex Inc and Nutanix, you can compare the effects of market volatilities on Wex and Nutanix 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 Wex with a short position of Nutanix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wex and Nutanix.
Diversification Opportunities for Wex and Nutanix
Good diversification
The 3 months correlation between Wex and Nutanix is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Wex Inc and Nutanix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nutanix and Wex 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 Wex Inc are associated (or correlated) with Nutanix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nutanix has no effect on the direction of Wex i.e., Wex and Nutanix go up and down completely randomly.
Pair Corralation between Wex and Nutanix
Considering the 90-day investment horizon Wex Inc is expected to under-perform the Nutanix. In addition to that, Wex is 1.14 times more volatile than Nutanix. It trades about -0.07 of its total potential returns per unit of risk. Nutanix is currently generating about 0.03 per unit of volatility. If you would invest 6,855 in Nutanix on November 18, 2024 and sell it today you would earn a total of 192.00 from holding Nutanix or generate 2.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wex Inc vs. Nutanix
Performance |
| Timeline |
| Wex Inc |
| Nutanix |
Wex and Nutanix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wex and Nutanix
The main advantage of trading using opposite Wex and Nutanix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wex position performs unexpectedly, Nutanix 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 Nutanix will offset losses from the drop in Nutanix's long position.| Wex vs. CSG Systems International | Wex vs. VeriSign | Wex vs. Consensus Cloud Solutions | Wex vs. Global Blue Group |
| Nutanix vs. Palo Alto Networks | Nutanix vs. Uipath Inc | Nutanix vs. Zscaler | Nutanix vs. Crowdstrike Holdings |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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