Correlation Between National Storage and Nordic Semiconductor
Can any of the company-specific risk be diversified away by investing in both National Storage and Nordic Semiconductor 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 National Storage and Nordic Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Storage Affiliates and Nordic Semiconductor ASA, you can compare the effects of market volatilities on National Storage and Nordic Semiconductor 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 National Storage with a short position of Nordic Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Storage and Nordic Semiconductor.
Diversification Opportunities for National Storage and Nordic Semiconductor
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between National and Nordic is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding National Storage Affiliates and Nordic Semiconductor ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Semiconductor ASA and National Storage 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 National Storage Affiliates are associated (or correlated) with Nordic Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Semiconductor ASA has no effect on the direction of National Storage i.e., National Storage and Nordic Semiconductor go up and down completely randomly.
Pair Corralation between National Storage and Nordic Semiconductor
Assuming the 90 days horizon National Storage is expected to generate 134.42 times less return on investment than Nordic Semiconductor. But when comparing it to its historical volatility, National Storage Affiliates is 1.38 times less risky than Nordic Semiconductor. It trades about 0.0 of its potential returns per unit of risk. Nordic Semiconductor ASA is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 835.00 in Nordic Semiconductor ASA on September 13, 2024 and sell it today you would earn a total of 45.00 from holding Nordic Semiconductor ASA or generate 5.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Storage Affiliates vs. Nordic Semiconductor ASA
Performance |
| Timeline |
| National Storage Aff |
| Nordic Semiconductor ASA |
National Storage and Nordic Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Storage and Nordic Semiconductor
The main advantage of trading using opposite National Storage and Nordic Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Storage position performs unexpectedly, Nordic Semiconductor 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 Nordic Semiconductor will offset losses from the drop in Nordic Semiconductor's long position.| National Storage vs. Lifeway Foods | National Storage vs. TYSON FOODS A | National Storage vs. SENECA FOODS A | National Storage vs. MCEWEN MINING INC |
| Nordic Semiconductor vs. Taiwan Semiconductor Manufacturing | Nordic Semiconductor vs. Broadcom | Nordic Semiconductor vs. Superior Plus Corp | Nordic Semiconductor vs. SIVERS SEMICONDUCTORS AB |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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