Correlation Analysis Between NIKKEI 225 and Straits Tms

This module allows you to analyze existing cross correlation between NIKKEI 225 and Straits Tms. You can compare the effects of market volatilities on NIKKEI 225 and Straits Tms 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 NIKKEI 225 with a short position of Straits Tms. See also your portfolio center. Please also check ongoing floating volatility patterns of NIKKEI 225 and Straits Tms.
Horizon     30 Days    Login   to change
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Comparative Performance

 Predicted Return Density 
      Returns 

NIKKEI 225  vs.  Straits Tms

 Performance (%) 
      Timeline 

Pair Volatility

Assuming 30 trading days horizon, NIKKEI 225 is expected to under-perform the Straits Tms. In addition to that, NIKKEI 225 is 1.49 times more volatile than Straits Tms. It trades about -0.08 of its total potential returns per unit of risk. Straits Tms is currently generating about 0.05 per unit of volatility. If you would invest  306,251  in Straits Tms on November 18, 2018 and sell it today you would earn a total of  5,174  from holding Straits Tms or generate 1.69% return on investment over 30 days.

Pair Corralation between NIKKEI 225 and Straits Tms

-0.28
Time Period2 Months [change]
DirectionNegative 
StrengthInsignificant
Accuracy80.49%
ValuesDaily Returns

Diversification Opportunities for NIKKEI 225 and Straits Tms

NIKKEI 225 diversification synergy

Very good diversification

Overlapping area represents the amount of risk that can be diversified away by holding NIKKEI 225 and Straits Tms in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Straits Tms and NIKKEI 225 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 NIKKEI 225 are associated (or correlated) with Straits Tms. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Straits Tms has no effect on the direction of NIKKEI 225 i.e. NIKKEI 225 and Straits Tms go up and down completely randomly.
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