Correlation Between Coda Octopus and Nabors Energy

Can any of the company-specific risk be diversified away by investing in both Coda Octopus and Nabors Energy 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 Coda Octopus and Nabors Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Coda Octopus Group and Nabors Energy Transition, you can compare the effects of market volatilities on Coda Octopus and Nabors Energy 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 Coda Octopus with a short position of Nabors Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coda Octopus and Nabors Energy.

Diversification Opportunities for Coda Octopus and Nabors Energy

-0.73

Correlation Coefficient

Coda Octopus  Nabors Energy

Pay attention - limited upside

The 3 months correlation between Coda and Nabors is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Coda Octopus Group and Nabors Energy Transition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nabors Energy Transition and Coda Octopus 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 Coda Octopus Group are associated (or correlated) with Nabors Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nabors Energy Transition has no effect on the direction of Coda Octopus i.e., Coda Octopus and Nabors Energy go up and down completely randomly.

Pair Corralation between Coda Octopus and Nabors Energy

If you would invest  786.00  in Coda Octopus Group on October 22, 2024 and sell it today you would earn a total of  28.00  from holding Coda Octopus Group or generate 3.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	0.0%
Values	Daily Returns

Coda Octopus Group  vs.  Nabors Energy Transition

Coda Octopus Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Coda Octopus Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Coda Octopus is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Nabors Energy Transition

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days Nabors Energy Transition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Nabors Energy is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Coda Octopus and Nabors Energy

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

The idea behind Coda Octopus Group and Nabors Energy Transition 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.

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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..