Correlation Between NISSIN FOODS and QUEEN S

Can any of the company-specific risk be diversified away by investing in both NISSIN FOODS and QUEEN S 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 NISSIN FOODS and QUEEN S into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NISSIN FOODS HLDGS and QUEEN S ROAD, you can compare the effects of market volatilities on NISSIN FOODS and QUEEN S 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 NISSIN FOODS with a short position of QUEEN S. Check out your portfolio center. Please also check ongoing floating volatility patterns of NISSIN FOODS and QUEEN S.

Diversification Opportunities for NISSIN FOODS and QUEEN S

-0.14

Correlation Coefficient

NISSIN FOODS  QUEEN S

Good diversification

The 3 months correlation between NISSIN and QUEEN is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding NISSIN FOODS HLDGS and QUEEN S ROAD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QUEEN S ROAD and NISSIN FOODS 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 NISSIN FOODS HLDGS are associated (or correlated) with QUEEN S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QUEEN S ROAD has no effect on the direction of NISSIN FOODS i.e., NISSIN FOODS and QUEEN S go up and down completely randomly.

Pair Corralation between NISSIN FOODS and QUEEN S

Assuming the 90 days trading horizon NISSIN FOODS is expected to generate 8.42 times less return on investment than QUEEN S. But when comparing it to its historical volatility, NISSIN FOODS HLDGS is 2.43 times less risky than QUEEN S. It trades about 0.01 of its potential returns per unit of risk. QUEEN S ROAD is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  45.00  in QUEEN S ROAD on October 4, 2024 and sell it today you would earn a total of  2.00  from holding QUEEN S ROAD or generate 4.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

NISSIN FOODS HLDGS  vs.  QUEEN S ROAD

NISSIN FOODS HLDGS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NISSIN FOODS HLDGS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

QUEEN S ROAD

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in QUEEN S ROAD are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, QUEEN S is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with NISSIN FOODS and QUEEN S

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

The idea behind NISSIN FOODS HLDGS and QUEEN S ROAD 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.