Correlation Between SOGECLAIR and Norwegian Air
Can any of the company-specific risk be diversified away by investing in both SOGECLAIR and Norwegian Air 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 SOGECLAIR and Norwegian Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOGECLAIR SA INH and Norwegian Air Shuttle, you can compare the effects of market volatilities on SOGECLAIR and Norwegian Air 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 SOGECLAIR with a short position of Norwegian Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOGECLAIR and Norwegian Air.
Diversification Opportunities for SOGECLAIR and Norwegian Air
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SOGECLAIR and Norwegian is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding SOGECLAIR SA INH and Norwegian Air Shuttle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norwegian Air Shuttle and SOGECLAIR 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 SOGECLAIR SA INH are associated (or correlated) with Norwegian Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norwegian Air Shuttle has no effect on the direction of SOGECLAIR i.e., SOGECLAIR and Norwegian Air go up and down completely randomly.
Pair Corralation between SOGECLAIR and Norwegian Air
Assuming the 90 days horizon SOGECLAIR SA INH is expected to generate 2.72 times more return on investment than Norwegian Air. However, SOGECLAIR is 2.72 times more volatile than Norwegian Air Shuttle. It trades about 0.16 of its potential returns per unit of risk. Norwegian Air Shuttle is currently generating about -0.15 per unit of risk. If you would invest 1,715 in SOGECLAIR SA INH on October 10, 2024 and sell it today you would earn a total of 230.00 from holding SOGECLAIR SA INH or generate 13.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOGECLAIR SA INH vs. Norwegian Air Shuttle
Performance |
| Timeline |
| SOGECLAIR SA INH |
| Norwegian Air Shuttle |
SOGECLAIR and Norwegian Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOGECLAIR and Norwegian Air
The main advantage of trading using opposite SOGECLAIR and Norwegian Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOGECLAIR position performs unexpectedly, Norwegian Air 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 Norwegian Air will offset losses from the drop in Norwegian Air's long position.| SOGECLAIR vs. GungHo Online Entertainment | SOGECLAIR vs. Guidewire Software | SOGECLAIR vs. YATRA ONLINE DL 0001 | SOGECLAIR vs. PACIFIC ONLINE |
| Norwegian Air vs. Data Modul AG | Norwegian Air vs. CN DATANG C | Norwegian Air vs. SCANSOURCE | Norwegian Air vs. Cass Information Systems |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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