Correlation Between ZEN Graphene and NanoXplore
Can any of the company-specific risk be diversified away by investing in both ZEN Graphene and NanoXplore 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 ZEN Graphene and NanoXplore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZEN Graphene Solutions and NanoXplore, you can compare the effects of market volatilities on ZEN Graphene and NanoXplore 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 ZEN Graphene with a short position of NanoXplore. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZEN Graphene and NanoXplore.
Diversification Opportunities for ZEN Graphene and NanoXplore
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between ZEN and NanoXplore is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding ZEN Graphene Solutions and NanoXplore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NanoXplore and ZEN Graphene 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 ZEN Graphene Solutions are associated (or correlated) with NanoXplore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NanoXplore has no effect on the direction of ZEN Graphene i.e., ZEN Graphene and NanoXplore go up and down completely randomly.
Pair Corralation between ZEN Graphene and NanoXplore
Assuming the 90 days horizon ZEN Graphene Solutions is expected to generate 2.53 times more return on investment than NanoXplore. However, ZEN Graphene is 2.53 times more volatile than NanoXplore. It trades about 0.14 of its potential returns per unit of risk. NanoXplore is currently generating about -0.05 per unit of risk. If you would invest 141.00 in ZEN Graphene Solutions on November 3, 2024 and sell it today you would earn a total of 21.00 from holding ZEN Graphene Solutions or generate 14.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZEN Graphene Solutions vs. NanoXplore
Performance |
| Timeline |
| ZEN Graphene Solutions |
| NanoXplore |
ZEN Graphene and NanoXplore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZEN Graphene and NanoXplore
The main advantage of trading using opposite ZEN Graphene and NanoXplore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZEN Graphene position performs unexpectedly, NanoXplore 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 NanoXplore will offset losses from the drop in NanoXplore's long position.| ZEN Graphene vs. American Manganese | ZEN Graphene vs. Frontier Lithium | ZEN Graphene vs. Graphene Manufacturing Group | ZEN Graphene vs. Northern Graphite |
| NanoXplore vs. Graphene Manufacturing Group | NanoXplore vs. Nano One Materials | NanoXplore vs. Coveo Solutions | NanoXplore vs. ZEN Graphene Solutions |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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