Correlation Between NX Filtration and Eurocommercial Properties

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

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

Diversification Opportunities for NX Filtration and Eurocommercial Properties

0.0

Correlation Coefficient

NX Filtration  Eurocommercial Properties

Pay attention - limited upside

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

Pair Corralation between NX Filtration and Eurocommercial Properties

If you would invest  2,177  in Eurocommercial Properties NV on December 25, 2024 and sell it today you would earn a total of  323.00  from holding Eurocommercial Properties NV or generate 14.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

NX Filtration Holding  vs.  Eurocommercial Properties NV

NX Filtration Holding

Risk-Adjusted Performance

Very Weak

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

Eurocommercial Properties

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Eurocommercial Properties NV are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Eurocommercial Properties sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NX Filtration and Eurocommercial Properties

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

The idea behind NX Filtration Holding and Eurocommercial Properties NV 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.