Correlation Between Navient Corp and EZCORP

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

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

Diversification Opportunities for Navient Corp and EZCORP

0.06

Correlation Coefficient

Navient Corp  EZCORP

Significant diversification

The 3 months correlation between Navient and EZCORP is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Navient Corp and EZCORP Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EZCORP Inc and Navient Corp 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 Navient Corp are associated (or correlated) with EZCORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EZCORP Inc has no effect on the direction of Navient Corp i.e., Navient Corp and EZCORP go up and down completely randomly.

Pair Corralation between Navient Corp and EZCORP

Given the investment horizon of 90 days Navient Corp is expected to generate 1.09 times more return on investment than EZCORP. However, Navient Corp is 1.09 times more volatile than EZCORP Inc. It trades about 0.01 of its potential returns per unit of risk. EZCORP Inc is currently generating about 0.01 per unit of risk. If you would invest  1,244  in Navient Corp on May 7, 2025 and sell it today you would earn a total of  6.00  from holding Navient Corp or generate 0.48% return on investment over 90 days.

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

Navient Corp  vs.  EZCORP Inc

Navient Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Navient Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Navient Corp is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

EZCORP Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days EZCORP Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, EZCORP is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Navient Corp and EZCORP

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

The idea behind Navient Corp and EZCORP 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.

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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.