Correlation Between Navigator Global and 88 Energy
Can any of the company-specific risk be diversified away by investing in both Navigator Global and 88 Energy 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 Navigator Global and 88 Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Navigator Global Investments and 88 Energy, you can compare the effects of market volatilities on Navigator Global and 88 Energy 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 Navigator Global with a short position of 88 Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Navigator Global and 88 Energy.
Diversification Opportunities for Navigator Global and 88 Energy
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Navigator and 88E is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Navigator Global Investments and 88 Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 88 Energy and Navigator Global 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 Navigator Global Investments are associated (or correlated) with 88 Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 88 Energy has no effect on the direction of Navigator Global i.e., Navigator Global and 88 Energy go up and down completely randomly.
Pair Corralation between Navigator Global and 88 Energy
Assuming the 90 days trading horizon Navigator Global Investments is expected to generate 0.11 times more return on investment than 88 Energy. However, Navigator Global Investments is 9.07 times less risky than 88 Energy. It trades about -0.02 of its potential returns per unit of risk. 88 Energy is currently generating about -0.02 per unit of risk. If you would invest 172.00 in Navigator Global Investments on September 1, 2024 and sell it today you would lose (3.00) from holding Navigator Global Investments or give up 1.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Navigator Global Investments vs. 88 Energy
Performance |
| Timeline |
| Navigator Global Inv |
| 88 Energy |
Navigator Global and 88 Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Navigator Global and 88 Energy
The main advantage of trading using opposite Navigator Global and 88 Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Navigator Global position performs unexpectedly, 88 Energy 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 88 Energy will offset losses from the drop in 88 Energy's long position.| Navigator Global vs. A1 Investments Resources | Navigator Global vs. K2 Asset Management | Navigator Global vs. MFF Capital Investments | Navigator Global vs. Ainsworth Game Technology |
| 88 Energy vs. AiMedia Technologies | 88 Energy vs. Strickland Metals | 88 Energy vs. Olivers Real Food | 88 Energy vs. Kneomedia |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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