Correlation Between Norvista Capital and Lake Resources

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

By analyzing existing cross correlation between Norvista Capital and Lake Resources NL, you can compare the effects of market volatilities on Norvista Capital and Lake Resources 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 Norvista Capital with a short position of Lake Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Norvista Capital and Lake Resources.

Diversification Opportunities for Norvista Capital and Lake Resources

0.0

Correlation Coefficient

Norvista Capital  Lake Resources

Pay attention - limited upside

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

Pair Corralation between Norvista Capital and Lake Resources

If you would invest  2.60  in Lake Resources NL on October 23, 2024 and sell it today you would earn a total of  0.24  from holding Lake Resources NL or generate 9.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	90.0%
Values	Daily Returns

Norvista Capital  vs.  Lake Resources NL

Norvista Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Norvista Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Norvista Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Lake Resources NL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lake Resources NL 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 forward-looking signals remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Norvista Capital and Lake Resources

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

The idea behind Norvista Capital and Lake Resources NL 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.