Correlation Between NICK Old and EZCORP

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

By analyzing existing cross correlation between NICK Old and EZCORP Inc, you can compare the effects of market volatilities on NICK Old and EZCORP 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 NICK Old with a short position of EZCORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of NICK Old and EZCORP.

Diversification Opportunities for NICK Old and EZCORP

0.0

Correlation Coefficient

NICK Old  EZCORP

Pay attention - limited upside

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

Pair Corralation between NICK Old and EZCORP

If you would invest  1,226  in EZCORP Inc on December 29, 2024 and sell it today you would earn a total of  242.00  from holding EZCORP Inc or generate 19.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

NICK Old  vs.  EZCORP Inc

NICK Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days NICK Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental indicators, NICK Old is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

EZCORP Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in EZCORP Inc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, EZCORP showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NICK Old and EZCORP

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

The idea behind NICK Old and EZCORP Inc 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 Transaction History module to view history of all your transactions and understand their impact on performance.