Correlation Between Nafpaktos Textile and Avax SA

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

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

Diversification Opportunities for Nafpaktos Textile and Avax SA

0.34

Correlation Coefficient

Nafpaktos Textile  Avax SA

Weak diversification

The 3 months correlation between Nafpaktos and Avax is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Nafpaktos Textile Industry and Avax SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avax SA and Nafpaktos Textile 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 Nafpaktos Textile Industry are associated (or correlated) with Avax SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avax SA has no effect on the direction of Nafpaktos Textile i.e., Nafpaktos Textile and Avax SA go up and down completely randomly.

Pair Corralation between Nafpaktos Textile and Avax SA

Assuming the 90 days trading horizon Nafpaktos Textile Industry is expected to generate 3.11 times more return on investment than Avax SA. However, Nafpaktos Textile is 3.11 times more volatile than Avax SA. It trades about 0.06 of its potential returns per unit of risk. Avax SA is currently generating about 0.1 per unit of risk. If you would invest  70.00  in Nafpaktos Textile Industry on April 24, 2025 and sell it today you would earn a total of  9.00  from holding Nafpaktos Textile Industry or generate 12.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Nafpaktos Textile Industry  vs.  Avax SA

Nafpaktos Textile

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Nafpaktos Textile Industry are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Nafpaktos Textile unveiled solid returns over the last few months and may actually be approaching a breakup point.

Avax SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Avax SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Avax SA may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Nafpaktos Textile and Avax SA

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

The idea behind Nafpaktos Textile Industry and Avax SA 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.