Correlation Between Nuvation Bio and Grindrod

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

By analyzing existing cross correlation between Nuvation Bio and Grindrod Ltd ADR, you can compare the effects of market volatilities on Nuvation Bio and Grindrod 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 Nuvation Bio with a short position of Grindrod. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuvation Bio and Grindrod.

Diversification Opportunities for Nuvation Bio and Grindrod

0.0

Correlation Coefficient

Nuvation Bio  Grindrod

Pay attention - limited upside

The 3 months correlation between Nuvation and Grindrod is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nuvation Bio and Grindrod Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grindrod ADR and Nuvation Bio 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 Nuvation Bio are associated (or correlated) with Grindrod. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grindrod ADR has no effect on the direction of Nuvation Bio i.e., Nuvation Bio and Grindrod go up and down completely randomly.

Pair Corralation between Nuvation Bio and Grindrod

If you would invest  1,800  in Grindrod Ltd ADR on December 30, 2024 and sell it today you would earn a total of  0.00  from holding Grindrod Ltd ADR or generate 0.0% return on investment over 90 days.

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

Nuvation Bio  vs.  Grindrod Ltd ADR

Nuvation Bio

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nuvation Bio has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Grindrod ADR

Risk-Adjusted Performance

Very Weak

Over the last 90 days Grindrod Ltd ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong essential indicators, Grindrod is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Nuvation Bio and Grindrod

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

The idea behind Nuvation Bio and Grindrod Ltd ADR 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.