Correlation Between NovAccess Global and China Solar

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

By analyzing existing cross correlation between NovAccess Global and China Solar Cln, you can compare the effects of market volatilities on NovAccess Global and China Solar 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 NovAccess Global with a short position of China Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of NovAccess Global and China Solar.

Diversification Opportunities for NovAccess Global and China Solar

0.23

Correlation Coefficient

NovAccess Global  China Solar

Modest diversification

The 3 months correlation between NovAccess and China is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding NovAccess Global and China Solar Cln in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Solar Cln and NovAccess Global 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 NovAccess Global are associated (or correlated) with China Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Solar Cln has no effect on the direction of NovAccess Global i.e., NovAccess Global and China Solar go up and down completely randomly.

Pair Corralation between NovAccess Global and China Solar

Given the investment horizon of 90 days NovAccess Global is expected to generate 5.35 times more return on investment than China Solar. However, NovAccess Global is 5.35 times more volatile than China Solar Cln. It trades about 0.14 of its potential returns per unit of risk. China Solar Cln is currently generating about 0.1 per unit of risk. If you would invest  0.04  in NovAccess Global on May 25, 2025 and sell it today you would lose (0.01) from holding NovAccess Global or give up 25.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

NovAccess Global  vs.  China Solar Cln

NovAccess Global

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in NovAccess Global are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, NovAccess Global showed solid returns over the last few months and may actually be approaching a breakup point.

China Solar Cln

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in China Solar Cln are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady basic indicators, China Solar disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NovAccess Global and China Solar

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

The idea behind NovAccess Global and China Solar Cln 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 Commodity Directory module to find actively traded commodities issued by global exchanges.