Correlation Between Nabors Industries and Shoe Carnival
Can any of the company-specific risk be diversified away by investing in both Nabors Industries and Shoe Carnival 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 Nabors Industries and Shoe Carnival into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nabors Industries and Shoe Carnival, you can compare the effects of market volatilities on Nabors Industries and Shoe Carnival 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 Nabors Industries with a short position of Shoe Carnival. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nabors Industries and Shoe Carnival.
Diversification Opportunities for Nabors Industries and Shoe Carnival
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nabors and Shoe is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Nabors Industries and Shoe Carnival in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shoe Carnival and Nabors Industries 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 Nabors Industries are associated (or correlated) with Shoe Carnival. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shoe Carnival has no effect on the direction of Nabors Industries i.e., Nabors Industries and Shoe Carnival go up and down completely randomly.
Pair Corralation between Nabors Industries and Shoe Carnival
Considering the 90-day investment horizon Nabors Industries is expected to generate 1.53 times more return on investment than Shoe Carnival. However, Nabors Industries is 1.53 times more volatile than Shoe Carnival. It trades about 0.03 of its potential returns per unit of risk. Shoe Carnival is currently generating about -0.03 per unit of risk. If you would invest 6,910 in Nabors Industries on September 1, 2024 and sell it today you would earn a total of 433.00 from holding Nabors Industries or generate 6.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Nabors Industries vs. Shoe Carnival
Performance |
Timeline |
Nabors Industries |
Shoe Carnival |
Nabors Industries and Shoe Carnival Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Nabors Industries and Shoe Carnival
The main advantage of trading using opposite Nabors Industries and Shoe Carnival positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nabors Industries position performs unexpectedly, Shoe Carnival 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 Shoe Carnival will offset losses from the drop in Shoe Carnival's long position.Nabors Industries vs. Borr Drilling | Nabors Industries vs. Patterson UTI Energy | Nabors Industries vs. Noble plc | Nabors Industries vs. Helmerich and Payne |
Shoe Carnival vs. Citi Trends | Shoe Carnival vs. Zumiez Inc | Shoe Carnival vs. Buckle Inc | Shoe Carnival vs. Cato Corporation |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories |