Correlation Between Nextensa and Greenyard
Can any of the company-specific risk be diversified away by investing in both Nextensa and Greenyard 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 Nextensa and Greenyard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nextensa NV and Greenyard NV, you can compare the effects of market volatilities on Nextensa and Greenyard 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 Nextensa with a short position of Greenyard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextensa and Greenyard.
Diversification Opportunities for Nextensa and Greenyard
Very poor diversification
The 3 months correlation between Nextensa and Greenyard is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Nextensa NV and Greenyard NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenyard NV and Nextensa 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 Nextensa NV are associated (or correlated) with Greenyard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenyard NV has no effect on the direction of Nextensa i.e., Nextensa and Greenyard go up and down completely randomly.
Pair Corralation between Nextensa and Greenyard
Assuming the 90 days trading horizon Nextensa NV is expected to under-perform the Greenyard. But the stock apears to be less risky and, when comparing its historical volatility, Nextensa NV is 1.5 times less risky than Greenyard. The stock trades about -0.12 of its potential returns per unit of risk. The Greenyard NV is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 620.00 in Greenyard NV on September 1, 2024 and sell it today you would lose (104.00) from holding Greenyard NV or give up 16.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.24% |
| Values | Daily Returns |
Nextensa NV vs. Greenyard NV
Performance |
| Timeline |
| Nextensa NV |
| Greenyard NV |
Nextensa and Greenyard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nextensa and Greenyard
The main advantage of trading using opposite Nextensa and Greenyard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nextensa position performs unexpectedly, Greenyard 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 Greenyard will offset losses from the drop in Greenyard's long position.| Nextensa vs. Ion Beam Applications | Nextensa vs. Immolease Trust NV | Nextensa vs. Retail Estates | Nextensa vs. Vastned Retail Belgium |
| Greenyard vs. Ontex Group NV | Greenyard vs. Exmar NV | Greenyard vs. Melexis NV | Greenyard vs. Biocartis Group NV |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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