Correlation Between Nautilus and Nikon
Can any of the company-specific risk be diversified away by investing in both Nautilus and Nikon 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 Nautilus and Nikon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nautilus Group and Nikon, you can compare the effects of market volatilities on Nautilus and Nikon 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 Nautilus with a short position of Nikon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nautilus and Nikon.
Diversification Opportunities for Nautilus and Nikon
Average diversification
The 3 months correlation between Nautilus and Nikon is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Nautilus Group and Nikon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nikon and Nautilus 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 Nautilus Group are associated (or correlated) with Nikon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nikon has no effect on the direction of Nautilus i.e., Nautilus and Nikon go up and down completely randomly.
Pair Corralation between Nautilus and Nikon
Considering the 90-day investment horizon Nautilus Group is expected to under-perform the Nikon. But the stock apears to be less risky and, when comparing its historical volatility, Nautilus Group is 2.19 times less risky than Nikon. The stock trades about -0.24 of its potential returns per unit of risk. The Nikon is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 1,244 in Nikon on August 31, 2024 and sell it today you would lose (203.00) from holding Nikon or give up 16.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 88.57% |
| Values | Daily Returns |
Nautilus Group vs. Nikon
Performance |
| Timeline |
| Nautilus Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nikon |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Nautilus and Nikon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nautilus and Nikon
The main advantage of trading using opposite Nautilus and Nikon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nautilus position performs unexpectedly, Nikon 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 Nikon will offset losses from the drop in Nikon's long position.| Nautilus vs. Xponential Fitness | Nautilus vs. Life Time Group | Nautilus vs. Mattel Inc | Nautilus vs. Bowlero Corp |
| Nikon vs. Yamaha Corp DRC | Nikon vs. Shimano Inc ADR | Nikon vs. Plby Group | Nikon vs. BANDAI NAMCO Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
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