Correlation Between Voltalia and Nacon Sa
Can any of the company-specific risk be diversified away by investing in both Voltalia and Nacon Sa 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 Voltalia and Nacon Sa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voltalia SA and Nacon Sa, you can compare the effects of market volatilities on Voltalia and Nacon Sa 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 Voltalia with a short position of Nacon Sa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voltalia and Nacon Sa.
Diversification Opportunities for Voltalia and Nacon Sa
Significant diversification
The 3 months correlation between Voltalia and Nacon is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Voltalia SA and Nacon Sa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nacon Sa and Voltalia 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 Voltalia SA are associated (or correlated) with Nacon Sa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nacon Sa has no effect on the direction of Voltalia i.e., Voltalia and Nacon Sa go up and down completely randomly.
Pair Corralation between Voltalia and Nacon Sa
Assuming the 90 days trading horizon Voltalia SA is expected to under-perform the Nacon Sa. But the stock apears to be less risky and, when comparing its historical volatility, Voltalia SA is 2.27 times less risky than Nacon Sa. The stock trades about -0.03 of its potential returns per unit of risk. The Nacon Sa is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 53.00 in Nacon Sa on October 24, 2024 and sell it today you would earn a total of 10.00 from holding Nacon Sa or generate 18.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voltalia SA vs. Nacon Sa
Performance |
| Timeline |
| Voltalia SA |
| Nacon Sa |
Voltalia and Nacon Sa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voltalia and Nacon Sa
The main advantage of trading using opposite Voltalia and Nacon Sa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voltalia position performs unexpectedly, Nacon Sa 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 Nacon Sa will offset losses from the drop in Nacon Sa's long position.The idea behind Voltalia SA and Nacon Sa pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Nacon Sa vs. BigBen Interactive | Nacon Sa vs. Neoen SA | Nacon Sa vs. Solutions 30 SE | Nacon Sa vs. Voltalia SA |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |