Correlation Between Man Wah and Norsk Hydro
Can any of the company-specific risk be diversified away by investing in both Man Wah and Norsk Hydro 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 Man Wah and Norsk Hydro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Man Wah Holdings and Norsk Hydro ASA, you can compare the effects of market volatilities on Man Wah and Norsk Hydro 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 Man Wah with a short position of Norsk Hydro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Man Wah and Norsk Hydro.
Diversification Opportunities for Man Wah and Norsk Hydro
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Man and Norsk is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Man Wah Holdings and Norsk Hydro ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norsk Hydro ASA and Man Wah 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 Man Wah Holdings are associated (or correlated) with Norsk Hydro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norsk Hydro ASA has no effect on the direction of Man Wah i.e., Man Wah and Norsk Hydro go up and down completely randomly.
Pair Corralation between Man Wah and Norsk Hydro
Assuming the 90 days horizon Man Wah Holdings is expected to under-perform the Norsk Hydro. In addition to that, Man Wah is 1.47 times more volatile than Norsk Hydro ASA. It trades about -0.03 of its total potential returns per unit of risk. Norsk Hydro ASA is currently generating about 0.0 per unit of volatility. If you would invest 549.00 in Norsk Hydro ASA on October 15, 2024 and sell it today you would lose (1.00) from holding Norsk Hydro ASA or give up 0.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Man Wah Holdings vs. Norsk Hydro ASA
Performance |
| Timeline |
| Man Wah Holdings |
| Norsk Hydro ASA |
Man Wah and Norsk Hydro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Man Wah and Norsk Hydro
The main advantage of trading using opposite Man Wah and Norsk Hydro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Man Wah position performs unexpectedly, Norsk Hydro 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 Norsk Hydro will offset losses from the drop in Norsk Hydro's long position.| Man Wah vs. SK TELECOM TDADR | Man Wah vs. Zoom Video Communications | Man Wah vs. INTERSHOP Communications Aktiengesellschaft | Man Wah vs. COMBA TELECOM SYST |
| Norsk Hydro vs. MHP Hotel AG | Norsk Hydro vs. InterContinental Hotels Group | Norsk Hydro vs. COVIVIO HOTELS INH | Norsk Hydro vs. MOVIE GAMES SA |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |