Correlation Between Nomura Holdings and DEXUS
Can any of the company-specific risk be diversified away by investing in both Nomura Holdings and DEXUS 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 Nomura Holdings and DEXUS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nomura Holdings and DEXUS, you can compare the effects of market volatilities on Nomura Holdings and DEXUS 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 Nomura Holdings with a short position of DEXUS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nomura Holdings and DEXUS.
Diversification Opportunities for Nomura Holdings and DEXUS
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nomura and DEXUS is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Nomura Holdings and DEXUS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DEXUS and Nomura Holdings 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 Nomura Holdings are associated (or correlated) with DEXUS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DEXUS has no effect on the direction of Nomura Holdings i.e., Nomura Holdings and DEXUS go up and down completely randomly.
Pair Corralation between Nomura Holdings and DEXUS
Assuming the 90 days horizon Nomura Holdings is expected to generate 1.08 times more return on investment than DEXUS. However, Nomura Holdings is 1.08 times more volatile than DEXUS. It trades about 0.07 of its potential returns per unit of risk. DEXUS is currently generating about 0.01 per unit of risk. If you would invest 336.00 in Nomura Holdings on August 31, 2024 and sell it today you would earn a total of 215.00 from holding Nomura Holdings or generate 63.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
Nomura Holdings vs. DEXUS
Performance |
| Timeline |
| Nomura Holdings |
| DEXUS |
Nomura Holdings and DEXUS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nomura Holdings and DEXUS
The main advantage of trading using opposite Nomura Holdings and DEXUS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nomura Holdings position performs unexpectedly, DEXUS 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 DEXUS will offset losses from the drop in DEXUS's long position.| Nomura Holdings vs. Sterling Construction | Nomura Holdings vs. Science Applications International | Nomura Holdings vs. Fidelity National Information | Nomura Holdings vs. Australian Agricultural |
| DEXUS vs. Superior Plus Corp | DEXUS vs. NMI Holdings | DEXUS vs. Origin Agritech | DEXUS vs. SIVERS SEMICONDUCTORS AB |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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