Correlation Between Nextnav Acquisition and KIMCO

Can any of the company-specific risk be diversified away by investing in both Nextnav Acquisition and KIMCO 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 KIMCO 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 KIMCO RLTY P, you can compare the effects of market volatilities on Nextnav Acquisition and KIMCO 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 KIMCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextnav Acquisition and KIMCO.

Diversification Opportunities for Nextnav Acquisition and KIMCO

-0.22

Correlation Coefficient

Nextnav Acquisition  KIMCO

Very good diversification

The 3 months correlation between Nextnav and KIMCO is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Nextnav Acquisition Corp and KIMCO RLTY P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KIMCO RLTY P 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 KIMCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KIMCO RLTY P has no effect on the direction of Nextnav Acquisition i.e., Nextnav Acquisition and KIMCO go up and down completely randomly.

Pair Corralation between Nextnav Acquisition and KIMCO

Allowing for the 90-day total investment horizon Nextnav Acquisition Corp is expected to generate 13.47 times more return on investment than KIMCO. However, Nextnav Acquisition is 13.47 times more volatile than KIMCO RLTY P. It trades about 0.13 of its potential returns per unit of risk. KIMCO RLTY P is currently generating about 0.01 per unit of risk. If you would invest  413.00  in Nextnav Acquisition Corp on October 7, 2024 and sell it today you would earn a total of  1,198  from holding Nextnav Acquisition Corp or generate 290.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	91.53%
Values	Daily Returns

Nextnav Acquisition Corp  vs.  KIMCO RLTY P

Nextnav Acquisition Corp

Risk-Adjusted Performance

24 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nextnav Acquisition Corp are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Nextnav Acquisition displayed solid returns over the last few months and may actually be approaching a breakup point.

KIMCO RLTY P

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KIMCO RLTY P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, KIMCO is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Nextnav Acquisition and KIMCO

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

The idea behind Nextnav Acquisition Corp and KIMCO RLTY P 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.

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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .