Correlation Between Nextnav Acquisition and SCHLUMBERGER

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

Diversification Opportunities for Nextnav Acquisition and SCHLUMBERGER

-0.42

Correlation Coefficient

Nextnav Acquisition  SCHLUMBERGER

Very good diversification

The 3 months correlation between Nextnav and SCHLUMBERGER is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Nextnav Acquisition Corp and SCHLUMBERGER INVESTMENT SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCHLUMBERGER INVESTMENT 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 SCHLUMBERGER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCHLUMBERGER INVESTMENT has no effect on the direction of Nextnav Acquisition i.e., Nextnav Acquisition and SCHLUMBERGER go up and down completely randomly.

Pair Corralation between Nextnav Acquisition and SCHLUMBERGER

Allowing for the 90-day total investment horizon Nextnav Acquisition Corp is expected to generate 6.85 times more return on investment than SCHLUMBERGER. However, Nextnav Acquisition is 6.85 times more volatile than SCHLUMBERGER INVESTMENT SA. It trades about -0.04 of its potential returns per unit of risk. SCHLUMBERGER INVESTMENT SA is currently generating about -0.44 per unit of risk. If you would invest  1,699  in Nextnav Acquisition Corp on October 8, 2024 and sell it today you would lose (88.00) from holding Nextnav Acquisition Corp or give up 5.18% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.0%
Values	Daily Returns

Nextnav Acquisition Corp  vs.  SCHLUMBERGER INVESTMENT SA

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.

SCHLUMBERGER INVESTMENT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SCHLUMBERGER INVESTMENT SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for SCHLUMBERGER INVESTMENT SA investors.

Pair Trading with Nextnav Acquisition and SCHLUMBERGER

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

The idea behind Nextnav Acquisition Corp and SCHLUMBERGER INVESTMENT SA 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.