Correlation Between GreenX Metals and Novavis Group

Can any of the company-specific risk be diversified away by investing in both GreenX Metals and Novavis Group 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 GreenX Metals and Novavis Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GreenX Metals and Novavis Group SA, you can compare the effects of market volatilities on GreenX Metals and Novavis Group 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 GreenX Metals with a short position of Novavis Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenX Metals and Novavis Group.

Diversification Opportunities for GreenX Metals and Novavis Group

-0.01

Correlation Coefficient

GreenX Metals  Novavis Group

Good diversification

The 3 months correlation between GreenX and Novavis is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding GreenX Metals and Novavis Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Novavis Group SA and GreenX Metals 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 GreenX Metals are associated (or correlated) with Novavis Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Novavis Group SA has no effect on the direction of GreenX Metals i.e., GreenX Metals and Novavis Group go up and down completely randomly.

Pair Corralation between GreenX Metals and Novavis Group

Assuming the 90 days trading horizon GreenX Metals is expected to generate 0.74 times more return on investment than Novavis Group. However, GreenX Metals is 1.36 times less risky than Novavis Group. It trades about 0.06 of its potential returns per unit of risk. Novavis Group SA is currently generating about -0.02 per unit of risk. If you would invest  179.00  in GreenX Metals on December 2, 2024 and sell it today you would earn a total of  13.00  from holding GreenX Metals or generate 7.26% return on investment over 90 days.

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

GreenX Metals  vs.  Novavis Group SA

GreenX Metals

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in GreenX Metals are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, GreenX Metals may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Novavis Group SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Novavis Group SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Novavis Group is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with GreenX Metals and Novavis Group

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

The idea behind GreenX Metals and Novavis Group 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.

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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.