Correlation Between NORDHEALTH and ALBIS LEASING
Can any of the company-specific risk be diversified away by investing in both NORDHEALTH and ALBIS LEASING 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 NORDHEALTH and ALBIS LEASING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NORDHEALTH AS NK and ALBIS LEASING AG, you can compare the effects of market volatilities on NORDHEALTH and ALBIS LEASING 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 NORDHEALTH with a short position of ALBIS LEASING. Check out your portfolio center. Please also check ongoing floating volatility patterns of NORDHEALTH and ALBIS LEASING.
Diversification Opportunities for NORDHEALTH and ALBIS LEASING
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NORDHEALTH and ALBIS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NORDHEALTH AS NK and ALBIS LEASING AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALBIS LEASING AG and NORDHEALTH 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 NORDHEALTH AS NK are associated (or correlated) with ALBIS LEASING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALBIS LEASING AG has no effect on the direction of NORDHEALTH i.e., NORDHEALTH and ALBIS LEASING go up and down completely randomly.
Pair Corralation between NORDHEALTH and ALBIS LEASING
Assuming the 90 days horizon NORDHEALTH AS NK is expected to generate 5.6 times more return on investment than ALBIS LEASING. However, NORDHEALTH is 5.6 times more volatile than ALBIS LEASING AG. It trades about 0.05 of its potential returns per unit of risk. ALBIS LEASING AG is currently generating about 0.09 per unit of risk. If you would invest 174.00 in NORDHEALTH AS NK on August 31, 2024 and sell it today you would earn a total of 120.00 from holding NORDHEALTH AS NK or generate 68.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NORDHEALTH AS NK vs. ALBIS LEASING AG
Performance |
| Timeline |
| NORDHEALTH AS NK |
| ALBIS LEASING AG |
NORDHEALTH and ALBIS LEASING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NORDHEALTH and ALBIS LEASING
The main advantage of trading using opposite NORDHEALTH and ALBIS LEASING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NORDHEALTH position performs unexpectedly, ALBIS LEASING 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 ALBIS LEASING will offset losses from the drop in ALBIS LEASING's long position.The idea behind NORDHEALTH AS NK and ALBIS LEASING AG 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.| ALBIS LEASING vs. EAGLE MATERIALS | ALBIS LEASING vs. URBAN OUTFITTERS | ALBIS LEASING vs. Transportadora de Gas | ALBIS LEASING vs. Eagle Materials |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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