This module allows you to analyze existing cross correlation between NQPH and NQEGT. You can compare the effects of market volatilities on NQPH and NQEGT 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 NQPH with a short position of NQEGT. See also your portfolio center. Please also check ongoing floating volatility patterns of NQPH and NQEGT.
Assuming 30 trading days horizon, NQPH is expected to generate 1.54 times more return on investment than NQEGT. However, NQPH is 1.54 times more volatile than NQEGT. It trades about 0.03 of its potential returns per unit of risk. NQEGT is currently generating about -0.19 per unit of risk. If you would invest 98,087 in NQPH on June 19, 2018 and sell it today you would earn a total of 744.00 from holding NQPH or generate 0.76% return on investment over 30 days.
Overlapping area represents the amount of risk that can be diversified away by holding NQPH and NQEGT in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on NQEGT and NQPH 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 NQPH are associated (or correlated) with NQEGT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NQEGT has no effect on the direction of NQPH i.e. NQPH and NQEGT go up and down completely randomly.
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