Correlation Between NMI Holdings and Sartorius Stedim
Can any of the company-specific risk be diversified away by investing in both NMI Holdings and Sartorius Stedim 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 Sartorius Stedim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NMI Holdings and Sartorius Stedim Biotech, you can compare the effects of market volatilities on NMI Holdings and Sartorius Stedim 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 Sartorius Stedim. Check out your portfolio center. Please also check ongoing floating volatility patterns of NMI Holdings and Sartorius Stedim.
Diversification Opportunities for NMI Holdings and Sartorius Stedim
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between NMI and Sartorius is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding NMI Holdings and Sartorius Stedim Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sartorius Stedim Biotech 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 Sartorius Stedim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sartorius Stedim Biotech has no effect on the direction of NMI Holdings i.e., NMI Holdings and Sartorius Stedim go up and down completely randomly.
Pair Corralation between NMI Holdings and Sartorius Stedim
Assuming the 90 days horizon NMI Holdings is expected to generate 0.55 times more return on investment than Sartorius Stedim. However, NMI Holdings is 1.82 times less risky than Sartorius Stedim. It trades about 0.07 of its potential returns per unit of risk. Sartorius Stedim Biotech is currently generating about -0.02 per unit of risk. If you would invest 2,040 in NMI Holdings on October 13, 2024 and sell it today you would earn a total of 1,420 from holding NMI Holdings or generate 69.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NMI Holdings vs. Sartorius Stedim Biotech
Performance |
| Timeline |
| NMI Holdings |
| Sartorius Stedim Biotech |
NMI Holdings and Sartorius Stedim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NMI Holdings and Sartorius Stedim
The main advantage of trading using opposite NMI Holdings and Sartorius Stedim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NMI Holdings position performs unexpectedly, Sartorius Stedim 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 Sartorius Stedim will offset losses from the drop in Sartorius Stedim's long position.| NMI Holdings vs. REVO INSURANCE SPA | NMI Holdings vs. Quaker Chemical | NMI Holdings vs. Cincinnati Financial Corp | NMI Holdings vs. Erste Group Bank |
| Sartorius Stedim vs. United Airlines Holdings | Sartorius Stedim vs. China Eastern Airlines | Sartorius Stedim vs. SMA Solar Technology | Sartorius Stedim vs. Nok Airlines PCL |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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