Correlation Between Navigator Global and Air New

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

By analyzing existing cross correlation between Navigator Global Investments and Air New Zealand, you can compare the effects of market volatilities on Navigator Global and Air New 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 Navigator Global with a short position of Air New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Navigator Global and Air New.

Diversification Opportunities for Navigator Global and Air New

-0.03

Correlation Coefficient

Navigator Global  Air New

Good diversification

The 3 months correlation between Navigator and Air is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Navigator Global Investments and Air New Zealand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air New Zealand and Navigator Global 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 Navigator Global Investments are associated (or correlated) with Air New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air New Zealand has no effect on the direction of Navigator Global i.e., Navigator Global and Air New go up and down completely randomly.

Pair Corralation between Navigator Global and Air New

Assuming the 90 days trading horizon Navigator Global Investments is expected to generate 1.57 times more return on investment than Air New. However, Navigator Global is 1.57 times more volatile than Air New Zealand. It trades about 0.04 of its potential returns per unit of risk. Air New Zealand is currently generating about 0.01 per unit of risk. If you would invest  172.00  in Navigator Global Investments on April 25, 2025 and sell it today you would earn a total of  8.00  from holding Navigator Global Investments or generate 4.65% return on investment over 90 days.

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

Navigator Global Investments  vs.  Air New Zealand

Navigator Global Inv

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Navigator Global Investments are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward indicators, Navigator Global may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Air New Zealand

Risk-Adjusted Performance

Very Weak

Over the last 90 days Air New Zealand has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Air New is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Navigator Global and Air New

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

The idea behind Navigator Global Investments and Air New Zealand 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.