Correlation Between Nextnav Acquisition and KVH Industries
Can any of the company-specific risk be diversified away by investing in both Nextnav Acquisition and KVH Industries 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 Nextnav Acquisition and KVH Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nextnav Acquisition Corp and KVH Industries, you can compare the effects of market volatilities on Nextnav Acquisition and KVH Industries 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 Nextnav Acquisition with a short position of KVH Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextnav Acquisition and KVH Industries.
Diversification Opportunities for Nextnav Acquisition and KVH Industries
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nextnav and KVH is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Nextnav Acquisition Corp and KVH Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KVH Industries and Nextnav Acquisition 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 Nextnav Acquisition Corp are associated (or correlated) with KVH Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KVH Industries has no effect on the direction of Nextnav Acquisition i.e., Nextnav Acquisition and KVH Industries go up and down completely randomly.
Pair Corralation between Nextnav Acquisition and KVH Industries
Allowing for the 90-day total investment horizon Nextnav Acquisition Corp is expected to under-perform the KVH Industries. In addition to that, Nextnav Acquisition is 2.63 times more volatile than KVH Industries. It trades about -0.16 of its total potential returns per unit of risk. KVH Industries is currently generating about 0.02 per unit of volatility. If you would invest 575.00 in KVH Industries on December 2, 2024 and sell it today you would earn a total of 8.00 from holding KVH Industries or generate 1.39% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Nextnav Acquisition Corp vs. KVH Industries
Performance |
Timeline |
Nextnav Acquisition Corp |
KVH Industries |
Nextnav Acquisition and KVH Industries Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Nextnav Acquisition and KVH Industries
The main advantage of trading using opposite Nextnav Acquisition and KVH Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nextnav Acquisition position performs unexpectedly, KVH Industries 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 KVH Industries will offset losses from the drop in KVH Industries' long position.Nextnav Acquisition vs. NetScout Systems | Nextnav Acquisition vs. Priority Technology Holdings | Nextnav Acquisition vs. OneSpan | Nextnav Acquisition vs. Consensus Cloud Solutions |
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Check out your portfolio center.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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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