Correlation Between NMI Holdings and Axway Software
Can any of the company-specific risk be diversified away by investing in both NMI Holdings and Axway Software 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 NMI Holdings and Axway Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NMI Holdings and Axway Software SA, you can compare the effects of market volatilities on NMI Holdings and Axway Software 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 NMI Holdings with a short position of Axway Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of NMI Holdings and Axway Software.
Diversification Opportunities for NMI Holdings and Axway Software
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NMI and Axway is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding NMI Holdings and Axway Software SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axway Software SA and NMI Holdings 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 NMI Holdings are associated (or correlated) with Axway Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axway Software SA has no effect on the direction of NMI Holdings i.e., NMI Holdings and Axway Software go up and down completely randomly.
Pair Corralation between NMI Holdings and Axway Software
Assuming the 90 days horizon NMI Holdings is expected to generate 0.8 times more return on investment than Axway Software. However, NMI Holdings is 1.24 times less risky than Axway Software. It trades about 0.1 of its potential returns per unit of risk. Axway Software SA is currently generating about 0.05 per unit of risk. If you would invest 3,000 in NMI Holdings on September 3, 2024 and sell it today you would earn a total of 760.00 from holding NMI Holdings or generate 25.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NMI Holdings vs. Axway Software SA
Performance |
| Timeline |
| NMI Holdings |
| Axway Software SA |
NMI Holdings and Axway Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NMI Holdings and Axway Software
The main advantage of trading using opposite NMI Holdings and Axway Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NMI Holdings position performs unexpectedly, Axway Software 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 Axway Software will offset losses from the drop in Axway Software's long position.| NMI Holdings vs. Harmony Gold Mining | NMI Holdings vs. WT OFFSHORE | NMI Holdings vs. Luckin Coffee | NMI Holdings vs. BJs Restaurants |
| Axway Software vs. Salesforce | Axway Software vs. Rocket Internet SE | Axway Software vs. Superior Plus Corp | Axway Software vs. NMI Holdings |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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