Correlation Between NSI NV and Klepierre

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

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

Diversification Opportunities for NSI NV and Klepierre

0.51

Correlation Coefficient

NSI NV  Klepierre

Very weak diversification

The 3 months correlation between NSI and Klepierre is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding NSI NV and Klepierre SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klepierre SA and NSI NV 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 NSI NV are associated (or correlated) with Klepierre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klepierre SA has no effect on the direction of NSI NV i.e., NSI NV and Klepierre go up and down completely randomly.

Pair Corralation between NSI NV and Klepierre

Assuming the 90 days trading horizon NSI NV is expected to under-perform the Klepierre. In addition to that, NSI NV is 1.12 times more volatile than Klepierre SA. It trades about 0.0 of its total potential returns per unit of risk. Klepierre SA is currently generating about 0.05 per unit of volatility. If you would invest  2,158  in Klepierre SA on October 26, 2024 and sell it today you would earn a total of  612.00  from holding Klepierre SA or generate 28.36% return on investment over 90 days.

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

NSI NV  vs.  Klepierre SA

NSI NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NSI NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward indicators, NSI NV is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Klepierre SA

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with NSI NV and Klepierre

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

The idea behind NSI NV and Klepierre 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.

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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.