Correlation Between Amer Sports, and NEXON Co
Can any of the company-specific risk be diversified away by investing in both Amer Sports, and NEXON Co 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 Amer Sports, and NEXON Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amer Sports, and NEXON Co, you can compare the effects of market volatilities on Amer Sports, and NEXON Co 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 Amer Sports, with a short position of NEXON Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amer Sports, and NEXON Co.
Diversification Opportunities for Amer Sports, and NEXON Co
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Amer and NEXON is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Amer Sports, and NEXON Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXON Co and Amer Sports, 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 Amer Sports, are associated (or correlated) with NEXON Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXON Co has no effect on the direction of Amer Sports, i.e., Amer Sports, and NEXON Co go up and down completely randomly.
Pair Corralation between Amer Sports, and NEXON Co
Allowing for the 90-day total investment horizon Amer Sports, is expected to generate 1.09 times more return on investment than NEXON Co. However, Amer Sports, is 1.09 times more volatile than NEXON Co. It trades about 0.13 of its potential returns per unit of risk. NEXON Co is currently generating about -0.22 per unit of risk. If you would invest 3,053 in Amer Sports, on November 9, 2024 and sell it today you would earn a total of 204.00 from holding Amer Sports, or generate 6.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Amer Sports, vs. NEXON Co
Performance |
| Timeline |
| Amer Sports, |
| NEXON Co |
Amer Sports, and NEXON Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amer Sports, and NEXON Co
The main advantage of trading using opposite Amer Sports, and NEXON Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amer Sports, position performs unexpectedly, NEXON Co 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 NEXON Co will offset losses from the drop in NEXON Co's long position.| Amer Sports, vs. Catalyst Metals Limited | Amer Sports, vs. Cabo Drilling Corp | Amer Sports, vs. Emerson Electric | Amer Sports, vs. Hurco Companies |
| NEXON Co vs. Konami Holdings | NEXON Co vs. Sega Sammy Holdings | NEXON Co vs. i3 Interactive | NEXON Co vs. IGG Inc |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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