Correlation Between NMI Holdings and Vestas Wind
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By analyzing existing cross correlation between NMI Holdings and Vestas Wind Systems, you can compare the effects of market volatilities on NMI Holdings and Vestas Wind 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 Vestas Wind. Check out your portfolio center. Please also check ongoing floating volatility patterns of NMI Holdings and Vestas Wind.
Diversification Opportunities for NMI Holdings and Vestas Wind
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between NMI and Vestas is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding NMI Holdings and Vestas Wind Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vestas Wind Systems 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 Vestas Wind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vestas Wind Systems has no effect on the direction of NMI Holdings i.e., NMI Holdings and Vestas Wind go up and down completely randomly.
Pair Corralation between NMI Holdings and Vestas Wind
Assuming the 90 days horizon NMI Holdings is expected to under-perform the Vestas Wind. But the stock apears to be less risky and, when comparing its historical volatility, NMI Holdings is 1.96 times less risky than Vestas Wind. The stock trades about -0.14 of its potential returns per unit of risk. The Vestas Wind Systems is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 1,282 in Vestas Wind Systems on October 15, 2024 and sell it today you would lose (30.00) from holding Vestas Wind Systems or give up 2.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NMI Holdings vs. Vestas Wind Systems
Performance |
| Timeline |
| NMI Holdings |
| Vestas Wind Systems |
NMI Holdings and Vestas Wind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NMI Holdings and Vestas Wind
The main advantage of trading using opposite NMI Holdings and Vestas Wind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NMI Holdings position performs unexpectedly, Vestas Wind 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 Vestas Wind will offset losses from the drop in Vestas Wind's long position.| NMI Holdings vs. PDS Biotechnology Corp | NMI Holdings vs. ANTA SPORTS PRODUCT | NMI Holdings vs. SOEDER SPORTFISKE AB | NMI Holdings vs. Platinum Investment Management |
| Vestas Wind vs. Superior Plus Corp | Vestas Wind vs. NMI Holdings | Vestas Wind vs. SIVERS SEMICONDUCTORS AB | Vestas Wind vs. Talanx AG |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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