Correlation Between Nova Vision and Black Hawk
Can any of the company-specific risk be diversified away by investing in both Nova Vision and Black Hawk 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 Nova Vision and Black Hawk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nova Vision Acquisition and Black Hawk Acquisition, you can compare the effects of market volatilities on Nova Vision and Black Hawk 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 Nova Vision with a short position of Black Hawk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nova Vision and Black Hawk.
Diversification Opportunities for Nova Vision and Black Hawk
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nova and Black is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Nova Vision Acquisition and Black Hawk Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Black Hawk Acquisition and Nova Vision 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 Nova Vision Acquisition are associated (or correlated) with Black Hawk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Black Hawk Acquisition has no effect on the direction of Nova Vision i.e., Nova Vision and Black Hawk go up and down completely randomly.
Pair Corralation between Nova Vision and Black Hawk
Assuming the 90 days horizon Nova Vision Acquisition is expected to generate 19.34 times more return on investment than Black Hawk. However, Nova Vision is 19.34 times more volatile than Black Hawk Acquisition. It trades about 0.13 of its potential returns per unit of risk. Black Hawk Acquisition is currently generating about 0.02 per unit of risk. If you would invest 1,284 in Nova Vision Acquisition on September 2, 2024 and sell it today you would earn a total of 2,816 from holding Nova Vision Acquisition or generate 219.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 90.63% |
| Values | Daily Returns |
Nova Vision Acquisition vs. Black Hawk Acquisition
Performance |
| Timeline |
| Nova Vision Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Black Hawk Acquisition |
Nova Vision and Black Hawk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nova Vision and Black Hawk
The main advantage of trading using opposite Nova Vision and Black Hawk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nova Vision position performs unexpectedly, Black Hawk 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 Black Hawk will offset losses from the drop in Black Hawk's long position.| Nova Vision vs. Brunswick | Nova Vision vs. Adient PLC | Nova Vision vs. Magna International | Nova Vision vs. JetBlue Airways Corp |
| Black Hawk vs. Voyager Acquisition Corp | Black Hawk vs. CO2 Energy Transition | Black Hawk vs. Vine Hill Capital | Black Hawk vs. DUET Acquisition 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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