Correlation Between Ozon Holdings and Dada Nexus

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

By analyzing existing cross correlation between Ozon Holdings PLC and Dada Nexus, you can compare the effects of market volatilities on Ozon Holdings and Dada Nexus 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 Ozon Holdings with a short position of Dada Nexus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ozon Holdings and Dada Nexus.

Diversification Opportunities for Ozon Holdings and Dada Nexus

0.0

Correlation Coefficient

Ozon Holdings  Dada Nexus

Pay attention - limited upside

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

Pair Corralation between Ozon Holdings and Dada Nexus

If you would invest  111.00  in Dada Nexus on September 3, 2024 and sell it today you would earn a total of  35.00  from holding Dada Nexus or generate 31.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Ozon Holdings PLC  vs.  Dada Nexus

Ozon Holdings PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ozon Holdings PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Ozon Holdings is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Dada Nexus

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dada Nexus are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain fundamental indicators, Dada Nexus sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ozon Holdings and Dada Nexus

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

The idea behind Ozon Holdings PLC and Dada Nexus 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.

Check out your portfolio center.

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 Bonds Directory module to find actively traded corporate debentures issued by US companies.