Correlation Between Nautilus and Crocs

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

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

Diversification Opportunities for Nautilus and Crocs

-0.45

Correlation Coefficient

Nautilus  Crocs

Very good diversification

The 3 months correlation between Nautilus and Crocs is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Nautilus Group and Crocs Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crocs Inc and Nautilus 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 Nautilus Group are associated (or correlated) with Crocs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crocs Inc has no effect on the direction of Nautilus i.e., Nautilus and Crocs go up and down completely randomly.

Pair Corralation between Nautilus and Crocs

If you would invest  62.00  in Nautilus Group on January 19, 2024 and sell it today you would earn a total of  0.00  from holding Nautilus Group or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	4.55%
Values	Daily Returns

Nautilus Group  vs.  Crocs Inc

Nautilus Group

Risk-Adjusted Performance

0 of 100

Very Weak

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

Crocs Inc

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Crocs Inc are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, Crocs showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nautilus and Crocs

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

The idea behind Nautilus Group and Crocs Inc 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.

Check out your portfolio center.

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 AI Investment Finder module to use AI to screen and filter profitable investment opportunities.