Correlation Between Aumann AG and Nel ASA
Can any of the company-specific risk be diversified away by investing in both Aumann AG and Nel ASA 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 Aumann AG and Nel ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aumann AG and Nel ASA, you can compare the effects of market volatilities on Aumann AG and Nel ASA 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 Aumann AG with a short position of Nel ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aumann AG and Nel ASA.
Diversification Opportunities for Aumann AG and Nel ASA
Poor diversification
The 3 months correlation between Aumann and Nel is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Aumann AG and Nel ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nel ASA and Aumann AG 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 Aumann AG are associated (or correlated) with Nel ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nel ASA has no effect on the direction of Aumann AG i.e., Aumann AG and Nel ASA go up and down completely randomly.
Pair Corralation between Aumann AG and Nel ASA
Assuming the 90 days horizon Aumann AG is expected to generate 0.61 times more return on investment than Nel ASA. However, Aumann AG is 1.63 times less risky than Nel ASA. It trades about 0.01 of its potential returns per unit of risk. Nel ASA is currently generating about -0.05 per unit of risk. If you would invest 1,400 in Aumann AG on August 24, 2024 and sell it today you would lose (100.00) from holding Aumann AG or give up 7.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 62.7% |
| Values | Daily Returns |
Aumann AG vs. Nel ASA
Performance |
| Timeline |
| Aumann AG |
| Nel ASA |
Aumann AG and Nel ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aumann AG and Nel ASA
The main advantage of trading using opposite Aumann AG and Nel ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aumann AG position performs unexpectedly, Nel ASA 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 Nel ASA will offset losses from the drop in Nel ASA's long position.| Aumann AG vs. Alfa Laval AB | Aumann AG vs. Arista Power | Aumann AG vs. Atlas Copco AB | Aumann AG vs. American Commerce Solutions |
| Nel ASA vs. Aumann AG | Nel ASA vs. Arista Power | Nel ASA vs. Atlas Copco AB | Nel ASA vs. American Commerce Solutions |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |