Correlation Between G J and Nava Nakorn

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

By analyzing existing cross correlation between G J Steel and Nava Nakorn Public, you can compare the effects of market volatilities on G J and Nava Nakorn 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 G J with a short position of Nava Nakorn. Check out your portfolio center. Please also check ongoing floating volatility patterns of G J and Nava Nakorn.

Diversification Opportunities for G J and Nava Nakorn

0.06

Correlation Coefficient

G J  Nava Nakorn

Significant diversification

The 3 months correlation between GJS and Nava is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding G J Steel and Nava Nakorn Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nava Nakorn Public and G J 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 G J Steel are associated (or correlated) with Nava Nakorn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nava Nakorn Public has no effect on the direction of G J i.e., G J and Nava Nakorn go up and down completely randomly.

Pair Corralation between G J and Nava Nakorn

If you would invest (100.00) in Nava Nakorn Public on January 30, 2024 and sell it today you would earn a total of  100.00  from holding Nava Nakorn Public or generate -100.0% return on investment over 90 days.

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

G J Steel  vs.  Nava Nakorn Public

G J Steel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days G J Steel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, G J is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Nava Nakorn Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nava Nakorn Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Nava Nakorn is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with G J and Nava Nakorn

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

The idea behind G J Steel and Nava Nakorn 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.