Correlation Between Nano X and Shoals Technologies
Can any of the company-specific risk be diversified away by investing in both Nano X and Shoals Technologies 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 Nano X and Shoals Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nano X Imaging and Shoals Technologies Group, you can compare the effects of market volatilities on Nano X and Shoals Technologies 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 Nano X with a short position of Shoals Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nano X and Shoals Technologies.
Diversification Opportunities for Nano X and Shoals Technologies
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Nano and Shoals is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Nano X Imaging and Shoals Technologies Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shoals Technologies and Nano X 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 Nano X Imaging are associated (or correlated) with Shoals Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shoals Technologies has no effect on the direction of Nano X i.e., Nano X and Shoals Technologies go up and down completely randomly.
Pair Corralation between Nano X and Shoals Technologies
Given the investment horizon of 90 days Nano X Imaging is expected to generate 1.3 times more return on investment than Shoals Technologies. However, Nano X is 1.3 times more volatile than Shoals Technologies Group. It trades about 0.19 of its potential returns per unit of risk. Shoals Technologies Group is currently generating about -0.06 per unit of risk. If you would invest 676.00 in Nano X Imaging on October 21, 2024 and sell it today you would earn a total of 165.00 from holding Nano X Imaging or generate 24.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nano X Imaging vs. Shoals Technologies Group
Performance |
| Timeline |
| Nano X Imaging |
| Shoals Technologies |
Nano X and Shoals Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nano X and Shoals Technologies
The main advantage of trading using opposite Nano X and Shoals Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nano X position performs unexpectedly, Shoals Technologies 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 Shoals Technologies will offset losses from the drop in Shoals Technologies' long position.| Nano X vs. Abbott Laboratories | Nano X vs. Stryker | Nano X vs. Edwards Lifesciences Corp | Nano X vs. Boston Scientific Corp |
| Shoals Technologies vs. Array Technologies | Shoals Technologies vs. Sunnova Energy International | Shoals Technologies vs. Fluence Energy | Shoals Technologies vs. Playtika Holding Corp |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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