Correlation Analysis Between Nasdaq and NIKKEI 225

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

Comparative Performance

 Predicted Return Density 

Nasdaq  vs.  NIKKEI 225

 Performance (%) 

Pair Volatility

Assuming 30 trading days horizon, Nasdaq is expected to under-perform the NIKKEI 225. In addition to that, Nasdaq is 1.27 times more volatile than NIKKEI 225. It trades about -0.11 of its total potential returns per unit of risk. NIKKEI 225 is currently generating about -0.08 per unit of volatility. If you would invest  2,201,078  in NIKKEI 225 on November 18, 2018 and sell it today you would lose (89,533)  from holding NIKKEI 225 or give up 4.07% of portfolio value over 30 days.

Pair Corralation between Nasdaq and NIKKEI 225

Time Period2 Months [change]
ValuesDaily Returns

Diversification Opportunities for Nasdaq and NIKKEI 225

Nasdaq diversification synergy

Poor diversification

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

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See also your portfolio center. Please also try Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.