Correlation Between Nordic Semiconductor and Carlsberg
Can any of the company-specific risk be diversified away by investing in both Nordic Semiconductor and Carlsberg 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 Nordic Semiconductor and Carlsberg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Semiconductor ASA and Carlsberg AS B, you can compare the effects of market volatilities on Nordic Semiconductor and Carlsberg 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 Nordic Semiconductor with a short position of Carlsberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Semiconductor and Carlsberg.
Diversification Opportunities for Nordic Semiconductor and Carlsberg
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Nordic and Carlsberg is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Semiconductor ASA and Carlsberg AS B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlsberg AS B and Nordic Semiconductor 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 Nordic Semiconductor ASA are associated (or correlated) with Carlsberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlsberg AS B has no effect on the direction of Nordic Semiconductor i.e., Nordic Semiconductor and Carlsberg go up and down completely randomly.
Pair Corralation between Nordic Semiconductor and Carlsberg
Assuming the 90 days trading horizon Nordic Semiconductor ASA is expected to under-perform the Carlsberg. In addition to that, Nordic Semiconductor is 1.36 times more volatile than Carlsberg AS B. It trades about -0.16 of its total potential returns per unit of risk. Carlsberg AS B is currently generating about -0.16 per unit of volatility. If you would invest 78,787 in Carlsberg AS B on August 27, 2024 and sell it today you would lose (4,417) from holding Carlsberg AS B or give up 5.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Semiconductor ASA vs. Carlsberg AS B
Performance |
| Timeline |
| Nordic Semiconductor ASA |
| Carlsberg AS B |
Nordic Semiconductor and Carlsberg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Semiconductor and Carlsberg
The main advantage of trading using opposite Nordic Semiconductor and Carlsberg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Semiconductor position performs unexpectedly, Carlsberg 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 Carlsberg will offset losses from the drop in Carlsberg's long position.| Nordic Semiconductor vs. Samsung Electronics Co | Nordic Semiconductor vs. Samsung Electronics Co | Nordic Semiconductor vs. Hyundai Motor | Nordic Semiconductor vs. Toyota Motor Corp |
| Carlsberg vs. Darden Restaurants | Carlsberg vs. Thor Mining PLC | Carlsberg vs. Bisichi Mining PLC | Carlsberg vs. Ion Beam Applications |
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 CEOs Directory module to screen CEOs from public companies around the world.
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