Correlation Between NOS SGPS and Navigator
Can any of the company-specific risk be diversified away by investing in both NOS SGPS and Navigator 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 NOS SGPS and Navigator into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NOS SGPS SA and The Navigator, you can compare the effects of market volatilities on NOS SGPS and Navigator 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 NOS SGPS with a short position of Navigator. Check out your portfolio center. Please also check ongoing floating volatility patterns of NOS SGPS and Navigator.
Diversification Opportunities for NOS SGPS and Navigator
Modest diversification
The 3 months correlation between NOS and Navigator is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding NOS SGPS SA and The Navigator in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Navigator and NOS SGPS 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 NOS SGPS SA are associated (or correlated) with Navigator. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Navigator has no effect on the direction of NOS SGPS i.e., NOS SGPS and Navigator go up and down completely randomly.
Pair Corralation between NOS SGPS and Navigator
Assuming the 90 days trading horizon NOS SGPS SA is expected to generate 0.79 times more return on investment than Navigator. However, NOS SGPS SA is 1.26 times less risky than Navigator. It trades about 0.06 of its potential returns per unit of risk. The Navigator is currently generating about 0.0 per unit of risk. If you would invest 293.00 in NOS SGPS SA on October 24, 2024 and sell it today you would earn a total of 40.00 from holding NOS SGPS SA or generate 13.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NOS SGPS SA vs. The Navigator
Performance |
| Timeline |
| NOS SGPS SA |
| Navigator |
NOS SGPS and Navigator Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NOS SGPS and Navigator
The main advantage of trading using opposite NOS SGPS and Navigator positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NOS SGPS position performs unexpectedly, Navigator 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 Navigator will offset losses from the drop in Navigator's long position.| NOS SGPS vs. Sonae SGPS SA | NOS SGPS vs. The Navigator | NOS SGPS vs. Galp Energia SGPS | NOS SGPS vs. REN Redes |
| Navigator vs. Altri SGPS SA | Navigator vs. Sonae SGPS SA | Navigator vs. NOS SGPS SA | Navigator vs. REN Redes |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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