Correlation Between Nebag Ag and Plazza AG

Can any of the company-specific risk be diversified away by investing in both Nebag Ag and Plazza AG 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 Nebag Ag and Plazza AG into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nebag ag and Plazza AG, you can compare the effects of market volatilities on Nebag Ag and Plazza AG 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 Nebag Ag with a short position of Plazza AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nebag Ag and Plazza AG.

Diversification Opportunities for Nebag Ag and Plazza AG

0.35

Correlation Coefficient

Nebag Ag  Plazza AG

Weak diversification

The 3 months correlation between Nebag and Plazza is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Nebag ag and Plazza AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plazza AG and Nebag Ag 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 Nebag ag are associated (or correlated) with Plazza AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plazza AG has no effect on the direction of Nebag Ag i.e., Nebag Ag and Plazza AG go up and down completely randomly.

Pair Corralation between Nebag Ag and Plazza AG

Assuming the 90 days trading horizon Nebag Ag is expected to generate 8.75 times less return on investment than Plazza AG. In addition to that, Nebag Ag is 4.65 times more volatile than Plazza AG. It trades about 0.01 of its total potential returns per unit of risk. Plazza AG is currently generating about 0.32 per unit of volatility. If you would invest  34,100  in Plazza AG on December 22, 2024 and sell it today you would earn a total of  2,300  from holding Plazza AG or generate 6.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	88.33%
Values	Daily Returns

Nebag ag  vs.  Plazza AG

Nebag ag

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nebag ag has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Nebag Ag is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Plazza AG

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Plazza AG are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Plazza AG may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Nebag Ag and Plazza AG

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

The idea behind Nebag ag and Plazza AG 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.