Correlation Between Emerging Markets and Nomura Real

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

By analyzing existing cross correlation between Emerging Markets Portfolio and Nomura Real Estate, you can compare the effects of market volatilities on Emerging Markets and Nomura Real 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 Emerging Markets with a short position of Nomura Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Markets and Nomura Real.

Diversification Opportunities for Emerging Markets and Nomura Real

0.78

Correlation Coefficient

Emerging Markets  Nomura Real

Poor diversification

The 3 months correlation between Emerging and Nomura is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Markets Portfolio and Nomura Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nomura Real Estate and Emerging Markets 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 Emerging Markets Portfolio are associated (or correlated) with Nomura Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nomura Real Estate has no effect on the direction of Emerging Markets i.e., Emerging Markets and Nomura Real go up and down completely randomly.

Pair Corralation between Emerging Markets and Nomura Real

Assuming the 90 days horizon Emerging Markets Portfolio is expected to generate 2.07 times more return on investment than Nomura Real. However, Emerging Markets is 2.07 times more volatile than Nomura Real Estate. It trades about 0.22 of its potential returns per unit of risk. Nomura Real Estate is currently generating about 0.13 per unit of risk. If you would invest  2,359  in Emerging Markets Portfolio on July 4, 2025 and sell it today you would earn a total of  215.00  from holding Emerging Markets Portfolio or generate 9.11% return on investment over 90 days.

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

Emerging Markets Portfolio  vs.  Nomura Real Estate

Emerging Markets Por

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Emerging Markets Portfolio are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental drivers, Emerging Markets may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Nomura Real Estate

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Nomura Real Estate are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, Nomura Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Emerging Markets and Nomura Real

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

The idea behind Emerging Markets Portfolio and Nomura Real Estate 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.