Correlation Between Nova Lithium and Hertz Global
Can any of the company-specific risk be diversified away by investing in both Nova Lithium and Hertz Global 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 Lithium and Hertz Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nova Lithium Corp and Hertz Global Holdings, you can compare the effects of market volatilities on Nova Lithium and Hertz Global 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 Lithium with a short position of Hertz Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nova Lithium and Hertz Global.
Diversification Opportunities for Nova Lithium and Hertz Global
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nova and Hertz is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Nova Lithium Corp and Hertz Global Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hertz Global Holdings and Nova Lithium 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 Lithium Corp are associated (or correlated) with Hertz Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hertz Global Holdings has no effect on the direction of Nova Lithium i.e., Nova Lithium and Hertz Global go up and down completely randomly.
Pair Corralation between Nova Lithium and Hertz Global
Assuming the 90 days horizon Nova Lithium Corp is expected to under-perform the Hertz Global. In addition to that, Nova Lithium is 1.03 times more volatile than Hertz Global Holdings. It trades about -0.16 of its total potential returns per unit of risk. Hertz Global Holdings is currently generating about 0.16 per unit of volatility. If you would invest 366.00 in Hertz Global Holdings on September 13, 2024 and sell it today you would earn a total of 57.50 from holding Hertz Global Holdings or generate 15.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Nova Lithium Corp vs. Hertz Global Holdings
Performance |
| Timeline |
| Nova Lithium Corp |
| Hertz Global Holdings |
Nova Lithium and Hertz Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nova Lithium and Hertz Global
The main advantage of trading using opposite Nova Lithium and Hertz Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nova Lithium position performs unexpectedly, Hertz Global 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 Hertz Global will offset losses from the drop in Hertz Global's long position.| Nova Lithium vs. Copa Holdings SA | Nova Lithium vs. United Airlines Holdings | Nova Lithium vs. Delta Air Lines | Nova Lithium vs. SkyWest |
| Hertz Global vs. United Rentals | Hertz Global vs. Ryder System | Hertz Global vs. Herc Holdings | Hertz Global vs. Hertz Global Hldgs |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |