Correlation Between Superior Plus and NTG Nordic
Can any of the company-specific risk be diversified away by investing in both Superior Plus and NTG Nordic 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 Superior Plus and NTG Nordic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and NTG Nordic Transport, you can compare the effects of market volatilities on Superior Plus and NTG Nordic 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 Superior Plus with a short position of NTG Nordic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and NTG Nordic.
Diversification Opportunities for Superior Plus and NTG Nordic
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Superior and NTG is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and NTG Nordic Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NTG Nordic Transport and Superior Plus 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 Superior Plus Corp are associated (or correlated) with NTG Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NTG Nordic Transport has no effect on the direction of Superior Plus i.e., Superior Plus and NTG Nordic go up and down completely randomly.
Pair Corralation between Superior Plus and NTG Nordic
Assuming the 90 days horizon Superior Plus Corp is expected to generate 2.72 times more return on investment than NTG Nordic. However, Superior Plus is 2.72 times more volatile than NTG Nordic Transport. It trades about -0.01 of its potential returns per unit of risk. NTG Nordic Transport is currently generating about -0.05 per unit of risk. If you would invest 428.00 in Superior Plus Corp on August 28, 2024 and sell it today you would lose (18.00) from holding Superior Plus Corp or give up 4.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. NTG Nordic Transport
Performance |
| Timeline |
| Superior Plus Corp |
| NTG Nordic Transport |
Superior Plus and NTG Nordic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and NTG Nordic
The main advantage of trading using opposite Superior Plus and NTG Nordic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, NTG Nordic 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 NTG Nordic will offset losses from the drop in NTG Nordic's long position.| Superior Plus vs. CDL INVESTMENT | Superior Plus vs. ECHO INVESTMENT ZY | Superior Plus vs. SEI INVESTMENTS | Superior Plus vs. Gruppo Mutuionline SpA |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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