Correlation Between Cartesian Growth and Nextplat Corp

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

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

Diversification Opportunities for Cartesian Growth and Nextplat Corp

0.6

Correlation Coefficient

Cartesian Growth  Nextplat Corp

Poor diversification

The 3 months correlation between Cartesian and Nextplat is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Cartesian Growth and Nextplat Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nextplat Corp and Cartesian Growth 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 Cartesian Growth are associated (or correlated) with Nextplat Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nextplat Corp has no effect on the direction of Cartesian Growth i.e., Cartesian Growth and Nextplat Corp go up and down completely randomly.

Pair Corralation between Cartesian Growth and Nextplat Corp

Assuming the 90 days horizon Cartesian Growth is expected to generate 22.79 times less return on investment than Nextplat Corp. But when comparing it to its historical volatility, Cartesian Growth is 8.78 times less risky than Nextplat Corp. It trades about 0.05 of its potential returns per unit of risk. Nextplat Corp is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  58.00  in Nextplat Corp on May 16, 2025 and sell it today you would earn a total of  20.00  from holding Nextplat Corp or generate 34.48% return on investment over 90 days.

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

Cartesian Growth  vs.  Nextplat Corp

Cartesian Growth

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Cartesian Growth are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Cartesian Growth is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Nextplat Corp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Nextplat Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite abnormal basic indicators, Nextplat Corp disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cartesian Growth and Nextplat Corp

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

The idea behind Cartesian Growth and Nextplat Corp 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.