Correlation Between Naas Technology and National Vision
Can any of the company-specific risk be diversified away by investing in both Naas Technology and National Vision 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 Naas Technology and National Vision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Naas Technology ADR and National Vision Holdings, you can compare the effects of market volatilities on Naas Technology and National Vision 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 Naas Technology with a short position of National Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Naas Technology and National Vision.
Diversification Opportunities for Naas Technology and National Vision
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Naas and National is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Naas Technology ADR and National Vision Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Vision Holdings and Naas Technology 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 Naas Technology ADR are associated (or correlated) with National Vision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Vision Holdings has no effect on the direction of Naas Technology i.e., Naas Technology and National Vision go up and down completely randomly.
Pair Corralation between Naas Technology and National Vision
Given the investment horizon of 90 days Naas Technology ADR is expected to under-perform the National Vision. In addition to that, Naas Technology is 2.65 times more volatile than National Vision Holdings. It trades about -0.03 of its total potential returns per unit of risk. National Vision Holdings is currently generating about -0.05 per unit of volatility. If you would invest 3,966 in National Vision Holdings on September 4, 2024 and sell it today you would lose (2,811) from holding National Vision Holdings or give up 70.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Naas Technology ADR vs. National Vision Holdings
Performance |
| Timeline |
| Naas Technology ADR |
| National Vision Holdings |
Naas Technology and National Vision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Naas Technology and National Vision
The main advantage of trading using opposite Naas Technology and National Vision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Naas Technology position performs unexpectedly, National Vision 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 National Vision will offset losses from the drop in National Vision's long position.| Naas Technology vs. Leslies | Naas Technology vs. Sally Beauty Holdings | Naas Technology vs. ODP Corp | Naas Technology vs. 1 800 FLOWERSCOM |
| National Vision vs. Alcon AG | National Vision vs. The Cooper Companies, | National Vision vs. AngioDynamics | National Vision vs. AptarGroup |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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