Correlation Between NI Holdings and 87612GAC5

Can any of the company-specific risk be diversified away by investing in both NI Holdings and 87612GAC5 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 NI Holdings and 87612GAC5 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NI Holdings and TRGP 6125 15 MAR 33, you can compare the effects of market volatilities on NI Holdings and 87612GAC5 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 NI Holdings with a short position of 87612GAC5. Check out your portfolio center. Please also check ongoing floating volatility patterns of NI Holdings and 87612GAC5.

Diversification Opportunities for NI Holdings and 87612GAC5

-0.77

Correlation Coefficient

NI Holdings  87612GAC5

Pay attention - limited upside

The 3 months correlation between NODK and 87612GAC5 is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding NI Holdings and TRGP 6125 15 MAR 33 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRGP 6125 15 and NI Holdings 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 NI Holdings are associated (or correlated) with 87612GAC5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRGP 6125 15 has no effect on the direction of NI Holdings i.e., NI Holdings and 87612GAC5 go up and down completely randomly.

Pair Corralation between NI Holdings and 87612GAC5

Given the investment horizon of 90 days NI Holdings is expected to generate 2.97 times more return on investment than 87612GAC5. However, NI Holdings is 2.97 times more volatile than TRGP 6125 15 MAR 33. It trades about 0.03 of its potential returns per unit of risk. TRGP 6125 15 MAR 33 is currently generating about -0.02 per unit of risk. If you would invest  1,618  in NI Holdings on September 13, 2024 and sell it today you would earn a total of  79.00  from holding NI Holdings or generate 4.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	90.41%
Values	Daily Returns

NI Holdings  vs.  TRGP 6125 15 MAR 33

NI Holdings

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in NI Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating fundamental indicators, NI Holdings may actually be approaching a critical reversion point that can send shares even higher in January 2025.

TRGP 6125 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TRGP 6125 15 MAR 33 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for TRGP 6125 15 MAR 33 investors.

Pair Trading with NI Holdings and 87612GAC5

The main advantage of trading using opposite NI Holdings and 87612GAC5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NI Holdings position performs unexpectedly, 87612GAC5 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 87612GAC5 will offset losses from the drop in 87612GAC5's long position.

The idea behind NI Holdings and TRGP 6125 15 MAR 33 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.