Correlation Between NVIDIA and Fly Leasing

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

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

Diversification Opportunities for NVIDIA and Fly Leasing

0.0

Correlation Coefficient

NVIDIA  Fly Leasing

Pay attention - limited upside

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

Pair Corralation between NVIDIA and Fly Leasing

If you would invest  2,421  in NVIDIA on October 5, 2024 and sell it today you would earn a total of  11,410  from holding NVIDIA or generate 471.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

NVIDIA  vs.  Fly Leasing Limited

NVIDIA

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in NVIDIA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental indicators, NVIDIA may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Fly Leasing Limited

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with NVIDIA and Fly Leasing

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

The idea behind NVIDIA and Fly Leasing Limited 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.