Correlation Between Green Street and National Vision

Can any of the company-specific risk be diversified away by investing in both Green Street and National Vision 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 Green Street and National Vision into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Green Street Capital and National Vision Holdings, you can compare the effects of market volatilities on Green Street and National Vision 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 Green Street with a short position of National Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Street and National Vision.

Diversification Opportunities for Green Street and National Vision

0.0

Correlation Coefficient

Green Street  National Vision

Pay attention - limited upside

The 3 months correlation between Green and National is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Green Street Capital and National Vision Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Vision Holdings and Green Street 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 Green Street Capital are associated (or correlated) with National Vision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Vision Holdings has no effect on the direction of Green Street i.e., Green Street and National Vision go up and down completely randomly.

Pair Corralation between Green Street and National Vision

If you would invest  1,102  in National Vision Holdings on October 25, 2024 and sell it today you would earn a total of  12.00  from holding National Vision Holdings or generate 1.09% return on investment over 90 days.

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

Green Street Capital  vs.  National Vision Holdings

Green Street Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Green Street Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Green Street is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

National Vision Holdings

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in National Vision Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, National Vision exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Green Street and National Vision

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

The idea behind Green Street Capital and National Vision Holdings 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.