Correlation Between National Atomic and Marwyn Value

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

By analyzing existing cross correlation between National Atomic Co and Marwyn Value Investors, you can compare the effects of market volatilities on National Atomic and Marwyn Value 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 National Atomic with a short position of Marwyn Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Atomic and Marwyn Value.

Diversification Opportunities for National Atomic and Marwyn Value

-0.04

Correlation Coefficient

National Atomic  Marwyn Value

Good diversification

The 3 months correlation between National and Marwyn is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding National Atomic Co and Marwyn Value Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marwyn Value Investors and National Atomic 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 National Atomic Co are associated (or correlated) with Marwyn Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marwyn Value Investors has no effect on the direction of National Atomic i.e., National Atomic and Marwyn Value go up and down completely randomly.

Pair Corralation between National Atomic and Marwyn Value

Assuming the 90 days trading horizon National Atomic Co is expected to generate 2.57 times more return on investment than Marwyn Value. However, National Atomic is 2.57 times more volatile than Marwyn Value Investors. It trades about 0.1 of its potential returns per unit of risk. Marwyn Value Investors is currently generating about -0.08 per unit of risk. If you would invest  3,635  in National Atomic Co on September 5, 2024 and sell it today you would earn a total of  425.00  from holding National Atomic Co or generate 11.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

National Atomic Co  vs.  Marwyn Value Investors

National Atomic

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in National Atomic Co are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, National Atomic may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Marwyn Value Investors

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Marwyn Value Investors has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Marwyn Value is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with National Atomic and Marwyn Value

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

The idea behind National Atomic Co and Marwyn Value Investors 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.