Correlation Between Nafoods Group and APG Securities
Can any of the company-specific risk be diversified away by investing in both Nafoods Group and APG Securities 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 Nafoods Group and APG Securities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nafoods Group JSC and APG Securities Joint, you can compare the effects of market volatilities on Nafoods Group and APG Securities 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 Nafoods Group with a short position of APG Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nafoods Group and APG Securities.
Diversification Opportunities for Nafoods Group and APG Securities
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nafoods and APG is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Nafoods Group JSC and APG Securities Joint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APG Securities Joint and Nafoods Group 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 Nafoods Group JSC are associated (or correlated) with APG Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APG Securities Joint has no effect on the direction of Nafoods Group i.e., Nafoods Group and APG Securities go up and down completely randomly.
Pair Corralation between Nafoods Group and APG Securities
Assuming the 90 days trading horizon Nafoods Group JSC is expected to generate 0.27 times more return on investment than APG Securities. However, Nafoods Group JSC is 3.74 times less risky than APG Securities. It trades about -0.07 of its potential returns per unit of risk. APG Securities Joint is currently generating about -0.23 per unit of risk. If you would invest 1,970,000 in Nafoods Group JSC on October 13, 2024 and sell it today you would lose (35,000) from holding Nafoods Group JSC or give up 1.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nafoods Group JSC vs. APG Securities Joint
Performance |
| Timeline |
| Nafoods Group JSC |
| APG Securities Joint |
Nafoods Group and APG Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nafoods Group and APG Securities
The main advantage of trading using opposite Nafoods Group and APG Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nafoods Group position performs unexpectedly, APG Securities 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 APG Securities will offset losses from the drop in APG Securities' long position.| Nafoods Group vs. FIT INVEST JSC | Nafoods Group vs. Damsan JSC | Nafoods Group vs. An Phat Plastic | Nafoods Group vs. APG Securities Joint |
| APG Securities vs. Nafoods Group JSC | APG Securities vs. Elcom Technology Communications | APG Securities vs. PetroVietnam Drilling Well | APG Securities vs. Industrial Urban Development |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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