Correlation Between Northstar Clean and Chiba Bank

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

By analyzing existing cross correlation between Northstar Clean Technologies and Chiba Bank Ltd, you can compare the effects of market volatilities on Northstar Clean and Chiba Bank 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 Northstar Clean with a short position of Chiba Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northstar Clean and Chiba Bank.

Diversification Opportunities for Northstar Clean and Chiba Bank

0.08

Correlation Coefficient

Northstar Clean  Chiba Bank

Significant diversification

The 3 months correlation between Northstar and Chiba is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Northstar Clean Technologies and Chiba Bank Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chiba Bank and Northstar Clean 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 Northstar Clean Technologies are associated (or correlated) with Chiba Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chiba Bank has no effect on the direction of Northstar Clean i.e., Northstar Clean and Chiba Bank go up and down completely randomly.

Pair Corralation between Northstar Clean and Chiba Bank

Assuming the 90 days horizon Northstar Clean Technologies is expected to under-perform the Chiba Bank. In addition to that, Northstar Clean is 3.63 times more volatile than Chiba Bank Ltd. It trades about -0.02 of its total potential returns per unit of risk. Chiba Bank Ltd is currently generating about 0.16 per unit of volatility. If you would invest  4,270  in Chiba Bank Ltd on May 7, 2025 and sell it today you would earn a total of  495.00  from holding Chiba Bank Ltd or generate 11.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Northstar Clean Technologies  vs.  Chiba Bank Ltd

Northstar Clean Tech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Northstar Clean Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Chiba Bank

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Chiba Bank Ltd are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Chiba Bank may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Northstar Clean and Chiba Bank

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

The idea behind Northstar Clean Technologies and Chiba Bank Ltd 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.