Correlation Between Coin Citadel and NSAV Holding

Can any of the company-specific risk be diversified away by investing in both Coin Citadel and NSAV Holding 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 Coin Citadel and NSAV Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Coin Citadel and NSAV Holding, you can compare the effects of market volatilities on Coin Citadel and NSAV Holding 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 Coin Citadel with a short position of NSAV Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coin Citadel and NSAV Holding.

Diversification Opportunities for Coin Citadel and NSAV Holding

-0.46

Correlation Coefficient

Coin Citadel  NSAV Holding

Very good diversification

The 3 months correlation between Coin and NSAV is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Coin Citadel and NSAV Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NSAV Holding and Coin Citadel 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 Coin Citadel are associated (or correlated) with NSAV Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NSAV Holding has no effect on the direction of Coin Citadel i.e., Coin Citadel and NSAV Holding go up and down completely randomly.

Pair Corralation between Coin Citadel and NSAV Holding

Given the investment horizon of 90 days Coin Citadel is expected to generate 1.33 times less return on investment than NSAV Holding. In addition to that, Coin Citadel is 1.21 times more volatile than NSAV Holding. It trades about 0.04 of its total potential returns per unit of risk. NSAV Holding is currently generating about 0.06 per unit of volatility. If you would invest  0.05  in NSAV Holding on December 27, 2024 and sell it today you would lose (0.01) from holding NSAV Holding or give up 20.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Coin Citadel  vs.  NSAV Holding

Coin Citadel

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Coin Citadel are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile basic indicators, Coin Citadel disclosed solid returns over the last few months and may actually be approaching a breakup point.

NSAV Holding

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in NSAV Holding are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, NSAV Holding showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Coin Citadel and NSAV Holding

The main advantage of trading using opposite Coin Citadel and NSAV Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coin Citadel position performs unexpectedly, NSAV Holding 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 NSAV Holding will offset losses from the drop in NSAV Holding's long position.

The idea behind Coin Citadel and NSAV Holding 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.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.