Correlation Between Superior Plus and NEXA RESOURCES
Can any of the company-specific risk be diversified away by investing in both Superior Plus and NEXA RESOURCES 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 Superior Plus and NEXA RESOURCES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and NEXA RESOURCES SA, you can compare the effects of market volatilities on Superior Plus and NEXA RESOURCES 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 Superior Plus with a short position of NEXA RESOURCES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and NEXA RESOURCES.
Diversification Opportunities for Superior Plus and NEXA RESOURCES
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Superior and NEXA is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and NEXA RESOURCES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXA RESOURCES SA and Superior Plus 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 Superior Plus Corp are associated (or correlated) with NEXA RESOURCES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXA RESOURCES SA has no effect on the direction of Superior Plus i.e., Superior Plus and NEXA RESOURCES go up and down completely randomly.
Pair Corralation between Superior Plus and NEXA RESOURCES
Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the NEXA RESOURCES. But the stock apears to be less risky and, when comparing its historical volatility, Superior Plus Corp is 1.15 times less risky than NEXA RESOURCES. The stock trades about -0.03 of its potential returns per unit of risk. The NEXA RESOURCES SA is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 458.00 in NEXA RESOURCES SA on August 28, 2024 and sell it today you would earn a total of 252.00 from holding NEXA RESOURCES SA or generate 55.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. NEXA RESOURCES SA
Performance |
| Timeline |
| Superior Plus Corp |
| NEXA RESOURCES SA |
Superior Plus and NEXA RESOURCES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and NEXA RESOURCES
The main advantage of trading using opposite Superior Plus and NEXA RESOURCES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, NEXA RESOURCES 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 NEXA RESOURCES will offset losses from the drop in NEXA RESOURCES's long position.| Superior Plus vs. Canon Marketing Japan | Superior Plus vs. CANON MARKETING JP | Superior Plus vs. KRISPY KREME DL 01 | Superior Plus vs. SIDETRADE EO 1 |
| NEXA RESOURCES vs. MAGIC SOFTWARE ENTR | NEXA RESOURCES vs. JAPAN AIRLINES | NEXA RESOURCES vs. MTI WIRELESS EDGE | NEXA RESOURCES vs. SINGAPORE AIRLINES |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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