Correlation Between General Silos and Nozha International

Can any of the company-specific risk be diversified away by investing in both General Silos and Nozha International 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 General Silos and Nozha International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between General Silos Storage and Nozha International Hospital, you can compare the effects of market volatilities on General Silos and Nozha International 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 General Silos with a short position of Nozha International. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Silos and Nozha International.

Diversification Opportunities for General Silos and Nozha International

0.5

Correlation Coefficient

General Silos  Nozha International

Very weak diversification

The 3 months correlation between General and Nozha is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding General Silos Storage and Nozha International Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nozha International and General Silos 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 General Silos Storage are associated (or correlated) with Nozha International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nozha International has no effect on the direction of General Silos i.e., General Silos and Nozha International go up and down completely randomly.

Pair Corralation between General Silos and Nozha International

Assuming the 90 days trading horizon General Silos Storage is expected to under-perform the Nozha International. In addition to that, General Silos is 1.61 times more volatile than Nozha International Hospital. It trades about -0.04 of its total potential returns per unit of risk. Nozha International Hospital is currently generating about 0.15 per unit of volatility. If you would invest  764.00  in Nozha International Hospital on September 27, 2024 and sell it today you would earn a total of  124.00  from holding Nozha International Hospital or generate 16.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	97.22%
Values	Daily Returns

General Silos Storage  vs.  Nozha International Hospital

General Silos Storage

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in General Silos Storage are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, General Silos reported solid returns over the last few months and may actually be approaching a breakup point.

Nozha International

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nozha International Hospital are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Nozha International reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with General Silos and Nozha International

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

The idea behind General Silos Storage and Nozha International Hospital 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.