Correlation Between Nike and VOXX International

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

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

Diversification Opportunities for Nike and VOXX International

-0.05

Correlation Coefficient

Nike  VOXX International

Good diversification

The 3 months correlation between Nike and VOXX is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Nike Inc and VOXX International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VOXX International and Nike 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 Nike Inc are associated (or correlated) with VOXX International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VOXX International has no effect on the direction of Nike i.e., Nike and VOXX International go up and down completely randomly.

Pair Corralation between Nike and VOXX International

Considering the 90-day investment horizon Nike Inc is expected to under-perform the VOXX International. In addition to that, Nike is 7.09 times more volatile than VOXX International. It trades about -0.1 of its total potential returns per unit of risk. VOXX International is currently generating about 0.15 per unit of volatility. If you would invest  729.00  in VOXX International on December 27, 2024 and sell it today you would earn a total of  19.00  from holding VOXX International or generate 2.61% return on investment over 90 days.

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

Nike Inc  vs.  VOXX International

Nike Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nike Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's forward-looking signals remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

VOXX International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in VOXX International are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, VOXX International is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Nike and VOXX International

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

The idea behind Nike Inc and VOXX International 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.