Correlation Between Xavis and Nepes
Can any of the company-specific risk be diversified away by investing in both Xavis and Nepes 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 Xavis and Nepes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xavis Co and Nepes, you can compare the effects of market volatilities on Xavis and Nepes 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 Xavis with a short position of Nepes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xavis and Nepes.
Diversification Opportunities for Xavis and Nepes
Almost no diversification
The 3 months correlation between Xavis and Nepes is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Xavis Co and Nepes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nepes and Xavis 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 Xavis Co are associated (or correlated) with Nepes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nepes has no effect on the direction of Xavis i.e., Xavis and Nepes go up and down completely randomly.
Pair Corralation between Xavis and Nepes
Assuming the 90 days trading horizon Xavis Co is expected to generate 1.02 times more return on investment than Nepes. However, Xavis is 1.02 times more volatile than Nepes. It trades about -0.03 of its potential returns per unit of risk. Nepes is currently generating about -0.1 per unit of risk. If you would invest 200,000 in Xavis Co on September 2, 2024 and sell it today you would lose (58,200) from holding Xavis Co or give up 29.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xavis Co vs. Nepes
Performance |
| Timeline |
| Xavis |
| Nepes |
Xavis and Nepes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xavis and Nepes
The main advantage of trading using opposite Xavis and Nepes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xavis position performs unexpectedly, Nepes 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 Nepes will offset losses from the drop in Nepes' long position.| Xavis vs. AurosTechnology | Xavis vs. Puloon Technology | Xavis vs. GS Retail Co | Xavis vs. ITM Semiconductor Co |
| Nepes vs. Dongjin Semichem Co | Nepes vs. SFA Semicon Co | Nepes vs. Seoul Semiconductor Co | Nepes vs. EO Technics Co |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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