Correlation Between NEXA RESOURCES and ONWARD MEDICAL
Can any of the company-specific risk be diversified away by investing in both NEXA RESOURCES and ONWARD MEDICAL 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 NEXA RESOURCES and ONWARD MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NEXA RESOURCES SA and ONWARD MEDICAL BV, you can compare the effects of market volatilities on NEXA RESOURCES and ONWARD MEDICAL 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 NEXA RESOURCES with a short position of ONWARD MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEXA RESOURCES and ONWARD MEDICAL.
Diversification Opportunities for NEXA RESOURCES and ONWARD MEDICAL
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NEXA and ONWARD is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding NEXA RESOURCES SA and ONWARD MEDICAL BV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ONWARD MEDICAL BV and NEXA RESOURCES 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 NEXA RESOURCES SA are associated (or correlated) with ONWARD MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ONWARD MEDICAL BV has no effect on the direction of NEXA RESOURCES i.e., NEXA RESOURCES and ONWARD MEDICAL go up and down completely randomly.
Pair Corralation between NEXA RESOURCES and ONWARD MEDICAL
Assuming the 90 days horizon NEXA RESOURCES SA is expected to under-perform the ONWARD MEDICAL. In addition to that, NEXA RESOURCES is 1.04 times more volatile than ONWARD MEDICAL BV. It trades about -0.18 of its total potential returns per unit of risk. ONWARD MEDICAL BV is currently generating about -0.01 per unit of volatility. If you would invest 580.00 in ONWARD MEDICAL BV on November 30, 2024 and sell it today you would lose (40.00) from holding ONWARD MEDICAL BV or give up 6.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
NEXA RESOURCES SA vs. ONWARD MEDICAL BV
Performance |
| Timeline |
| NEXA RESOURCES SA |
| ONWARD MEDICAL BV |
NEXA RESOURCES and ONWARD MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEXA RESOURCES and ONWARD MEDICAL
The main advantage of trading using opposite NEXA RESOURCES and ONWARD MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEXA RESOURCES position performs unexpectedly, ONWARD MEDICAL 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 ONWARD MEDICAL will offset losses from the drop in ONWARD MEDICAL's long position.| NEXA RESOURCES vs. HANOVER INSURANCE | NEXA RESOURCES vs. Maple Leaf Foods | NEXA RESOURCES vs. BG Foods | NEXA RESOURCES vs. INSURANCE AUST GRP |
| ONWARD MEDICAL vs. Schweizer Electronic AG | ONWARD MEDICAL vs. SINGAPORE AIRLINES | ONWARD MEDICAL vs. Renesas Electronics | ONWARD MEDICAL vs. UMC Electronics 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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