Correlation Between Nano Labs and Kopin

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

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

Diversification Opportunities for Nano Labs and Kopin

0.5

Correlation Coefficient

Nano Labs  Kopin

Very weak diversification

The 3 months correlation between Nano and Kopin is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Nano Labs and Kopin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kopin and Nano Labs 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 Nano Labs are associated (or correlated) with Kopin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kopin has no effect on the direction of Nano Labs i.e., Nano Labs and Kopin go up and down completely randomly.

Pair Corralation between Nano Labs and Kopin

Allowing for the 90-day total investment horizon Nano Labs is expected to generate 5.02 times more return on investment than Kopin. However, Nano Labs is 5.02 times more volatile than Kopin. It trades about 0.16 of its potential returns per unit of risk. Kopin is currently generating about 0.25 per unit of risk. If you would invest  317.00  in Nano Labs on September 20, 2024 and sell it today you would earn a total of  610.00  from holding Nano Labs or generate 192.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Nano Labs  vs.  Kopin

Nano Labs

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nano Labs are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Nano Labs sustained solid returns over the last few months and may actually be approaching a breakup point.

Kopin

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kopin are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Kopin displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nano Labs and Kopin

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

The idea behind Nano Labs and Kopin 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.