Correlation Between NVIDIA and Kerry Express

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

By analyzing existing cross correlation between NVIDIA and Kerry Express Public, you can compare the effects of market volatilities on NVIDIA and Kerry Express 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 Kerry Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of NVIDIA and Kerry Express.

Diversification Opportunities for NVIDIA and Kerry Express

-0.33

Correlation Coefficient

NVIDIA  Kerry Express

Very good diversification

The 3 months correlation between NVIDIA and Kerry is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding NVIDIA and Kerry Express Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kerry Express Public 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 Kerry Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kerry Express Public has no effect on the direction of NVIDIA i.e., NVIDIA and Kerry Express go up and down completely randomly.

Pair Corralation between NVIDIA and Kerry Express

Given the investment horizon of 90 days NVIDIA is expected to generate 0.92 times more return on investment than Kerry Express. However, NVIDIA is 1.09 times less risky than Kerry Express. It trades about 0.14 of its potential returns per unit of risk. Kerry Express Public is currently generating about -0.08 per unit of risk. If you would invest  4,661  in NVIDIA on October 5, 2024 and sell it today you would earn a total of  9,170  from holding NVIDIA or generate 196.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.64%
Values	Daily Returns

NVIDIA  vs.  Kerry Express Public

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.

Kerry Express Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kerry Express Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with NVIDIA and Kerry Express

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

The idea behind NVIDIA and Kerry Express Public 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.