Correlation Between Axfood AB and NTT DATA
Can any of the company-specific risk be diversified away by investing in both Axfood AB and NTT DATA 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 Axfood AB and NTT DATA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axfood AB and NTT DATA , you can compare the effects of market volatilities on Axfood AB and NTT DATA 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 Axfood AB with a short position of NTT DATA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axfood AB and NTT DATA.
Diversification Opportunities for Axfood AB and NTT DATA
Pay attention - limited upside
The 3 months correlation between Axfood and NTT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Axfood AB and NTT DATA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NTT DATA and Axfood AB 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 Axfood AB are associated (or correlated) with NTT DATA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NTT DATA has no effect on the direction of Axfood AB i.e., Axfood AB and NTT DATA go up and down completely randomly.
Pair Corralation between Axfood AB and NTT DATA
Assuming the 90 days trading horizon Axfood AB is expected to generate 1.22 times more return on investment than NTT DATA. However, Axfood AB is 1.22 times more volatile than NTT DATA . It trades about 0.07 of its potential returns per unit of risk. NTT DATA is currently generating about 0.04 per unit of risk. If you would invest 1,029 in Axfood AB on November 5, 2024 and sell it today you would earn a total of 1,045 from holding Axfood AB or generate 101.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axfood AB vs. NTT DATA
Performance |
| Timeline |
| Axfood AB |
| NTT DATA |
Axfood AB and NTT DATA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axfood AB and NTT DATA
The main advantage of trading using opposite Axfood AB and NTT DATA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axfood AB position performs unexpectedly, NTT DATA 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 NTT DATA will offset losses from the drop in NTT DATA's long position.| Axfood AB vs. H2O Retailing | Axfood AB vs. Mitsui Chemicals | Axfood AB vs. AEON STORES | Axfood AB vs. AIR PRODCHEMICALS |
| NTT DATA vs. Singapore Telecommunications Limited | NTT DATA vs. Scientific Games | NTT DATA vs. Charter Communications | NTT DATA vs. GAMING FAC 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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