Correlation Between Nanalysis Scientific and Simply Better

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

By analyzing existing cross correlation between Nanalysis Scientific Corp and Simply Better Brands, you can compare the effects of market volatilities on Nanalysis Scientific and Simply Better 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 Nanalysis Scientific with a short position of Simply Better. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanalysis Scientific and Simply Better.

Diversification Opportunities for Nanalysis Scientific and Simply Better

-0.86

Correlation Coefficient

Nanalysis Scientific  Simply Better

Pay attention - limited upside

The 3 months correlation between Nanalysis and Simply is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Nanalysis Scientific Corp and Simply Better Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simply Better Brands and Nanalysis Scientific 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 Nanalysis Scientific Corp are associated (or correlated) with Simply Better. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simply Better Brands has no effect on the direction of Nanalysis Scientific i.e., Nanalysis Scientific and Simply Better go up and down completely randomly.

Pair Corralation between Nanalysis Scientific and Simply Better

Assuming the 90 days trading horizon Nanalysis Scientific Corp is expected to under-perform the Simply Better. But the stock apears to be less risky and, when comparing its historical volatility, Nanalysis Scientific Corp is 1.13 times less risky than Simply Better. The stock trades about -0.01 of its potential returns per unit of risk. The Simply Better Brands is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  35.00  in Simply Better Brands on October 3, 2024 and sell it today you would earn a total of  74.00  from holding Simply Better Brands or generate 211.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	99.74%
Values	Daily Returns

Nanalysis Scientific Corp  vs.  Simply Better Brands

Nanalysis Scientific Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nanalysis Scientific Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's fundamental indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Simply Better Brands

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Simply Better Brands are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal fundamental drivers, Simply Better showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nanalysis Scientific and Simply Better

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

The idea behind Nanalysis Scientific Corp and Simply Better Brands 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.