Correlation Between Nomura Holdings and Innventure,

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

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

Diversification Opportunities for Nomura Holdings and Innventure,

-0.03

Correlation Coefficient

Nomura Holdings  Innventure,

Good diversification

The 3 months correlation between Nomura and Innventure, is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Nomura Holdings ADR and Innventure, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innventure, and Nomura Holdings 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 Nomura Holdings ADR are associated (or correlated) with Innventure,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innventure, has no effect on the direction of Nomura Holdings i.e., Nomura Holdings and Innventure, go up and down completely randomly.

Pair Corralation between Nomura Holdings and Innventure,

Considering the 90-day investment horizon Nomura Holdings is expected to generate 1.13 times less return on investment than Innventure,. But when comparing it to its historical volatility, Nomura Holdings ADR is 3.38 times less risky than Innventure,. It trades about 0.19 of its potential returns per unit of risk. Innventure, is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1,120  in Innventure, on October 23, 2024 and sell it today you would earn a total of  140.00  from holding Innventure, or generate 12.5% return on investment over 90 days.

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

Nomura Holdings ADR  vs.  Innventure,

Nomura Holdings ADR

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nomura Holdings ADR are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak primary indicators, Nomura Holdings reported solid returns over the last few months and may actually be approaching a breakup point.

Innventure,

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Innventure, are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Innventure, showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nomura Holdings and Innventure,

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

The idea behind Nomura Holdings ADR and Innventure, 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 Global Correlations module to find global opportunities by holding instruments from different markets.