Correlation Between ALTAIR RES and Norwegian Air
Can any of the company-specific risk be diversified away by investing in both ALTAIR RES and Norwegian Air 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 ALTAIR RES and Norwegian Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALTAIR RES INC and Norwegian Air Shuttle, you can compare the effects of market volatilities on ALTAIR RES and Norwegian Air 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 ALTAIR RES with a short position of Norwegian Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALTAIR RES and Norwegian Air.
Diversification Opportunities for ALTAIR RES and Norwegian Air
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ALTAIR and Norwegian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ALTAIR RES INC and Norwegian Air Shuttle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norwegian Air Shuttle and ALTAIR RES 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 ALTAIR RES INC are associated (or correlated) with Norwegian Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norwegian Air Shuttle has no effect on the direction of ALTAIR RES i.e., ALTAIR RES and Norwegian Air go up and down completely randomly.
Pair Corralation between ALTAIR RES and Norwegian Air
Assuming the 90 days trading horizon ALTAIR RES INC is expected to generate 22.12 times more return on investment than Norwegian Air. However, ALTAIR RES is 22.12 times more volatile than Norwegian Air Shuttle. It trades about 0.09 of its potential returns per unit of risk. Norwegian Air Shuttle is currently generating about 0.02 per unit of risk. If you would invest 0.05 in ALTAIR RES INC on August 28, 2024 and sell it today you would earn a total of 0.00 from holding ALTAIR RES INC or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
ALTAIR RES INC vs. Norwegian Air Shuttle
Performance |
| Timeline |
| ALTAIR RES INC |
| Norwegian Air Shuttle |
ALTAIR RES and Norwegian Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALTAIR RES and Norwegian Air
The main advantage of trading using opposite ALTAIR RES and Norwegian Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALTAIR RES position performs unexpectedly, Norwegian Air 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 Norwegian Air will offset losses from the drop in Norwegian Air's long position.| ALTAIR RES vs. Superior Plus Corp | ALTAIR RES vs. NMI Holdings | ALTAIR RES vs. Origin Agritech | ALTAIR RES vs. SIVERS SEMICONDUCTORS AB |
| Norwegian Air vs. Jacquet Metal Service | Norwegian Air vs. ALTAIR RES INC | Norwegian Air vs. Alaska Air Group | Norwegian Air vs. ADRIATIC METALS LS 013355 |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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