Correlation Between Nutanix and Global Blue

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

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

Diversification Opportunities for Nutanix and Global Blue

-0.25

Correlation Coefficient

Nutanix  Global Blue

Very good diversification

The 3 months correlation between Nutanix and Global is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Nutanix and Global Blue Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Blue Group and Nutanix 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 Nutanix are associated (or correlated) with Global Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Blue Group has no effect on the direction of Nutanix i.e., Nutanix and Global Blue go up and down completely randomly.

Pair Corralation between Nutanix and Global Blue

Given the investment horizon of 90 days Nutanix is expected to generate 0.97 times more return on investment than Global Blue. However, Nutanix is 1.03 times less risky than Global Blue. It trades about 0.1 of its potential returns per unit of risk. Global Blue Group is currently generating about 0.06 per unit of risk. If you would invest  6,157  in Nutanix on December 28, 2024 and sell it today you would earn a total of  945.00  from holding Nutanix or generate 15.35% return on investment over 90 days.

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

Nutanix  vs.  Global Blue Group

Nutanix

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nutanix are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Nutanix showed solid returns over the last few months and may actually be approaching a breakup point.

Global Blue Group

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Global Blue Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental drivers, Global Blue may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Nutanix and Global Blue

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

The idea behind Nutanix and Global Blue Group 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.