Correlation Between Auto Trader and Nok Airlines
Can any of the company-specific risk be diversified away by investing in both Auto Trader and Nok Airlines 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 Auto Trader and Nok Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auto Trader Group and Nok Airlines PCL, you can compare the effects of market volatilities on Auto Trader and Nok Airlines 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 Auto Trader with a short position of Nok Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auto Trader and Nok Airlines.
Diversification Opportunities for Auto Trader and Nok Airlines
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Auto and Nok is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Auto Trader Group and Nok Airlines PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nok Airlines PCL and Auto Trader 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 Auto Trader Group are associated (or correlated) with Nok Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nok Airlines PCL has no effect on the direction of Auto Trader i.e., Auto Trader and Nok Airlines go up and down completely randomly.
Pair Corralation between Auto Trader and Nok Airlines
If you would invest 640.00 in Auto Trader Group on September 4, 2024 and sell it today you would earn a total of 380.00 from holding Auto Trader Group or generate 59.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Auto Trader Group vs. Nok Airlines PCL
Performance |
| Timeline |
| Auto Trader Group |
| Nok Airlines PCL |
Auto Trader and Nok Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auto Trader and Nok Airlines
The main advantage of trading using opposite Auto Trader and Nok Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auto Trader position performs unexpectedly, Nok Airlines 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 Nok Airlines will offset losses from the drop in Nok Airlines' long position.| Auto Trader vs. Apple Inc | Auto Trader vs. Apple Inc | Auto Trader vs. Apple Inc | Auto Trader vs. Apple Inc |
| Nok Airlines vs. AIR PRODCHEMICALS | Nok Airlines vs. Data3 Limited | Nok Airlines vs. DATAGROUP SE | Nok Airlines vs. Automatic Data Processing |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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