Correlation Between Barnes and Nel ASA
Can any of the company-specific risk be diversified away by investing in both Barnes 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 Barnes and Nel ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barnes Group and Nel ASA, you can compare the effects of market volatilities on Barnes 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 Barnes with a short position of Nel ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barnes and Nel ASA.
Diversification Opportunities for Barnes and Nel ASA
Very weak diversification
The 3 months correlation between Barnes and Nel is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Barnes Group and Nel ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nel ASA and Barnes 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 Barnes Group 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 Barnes i.e., Barnes and Nel ASA go up and down completely randomly.
Pair Corralation between Barnes and Nel ASA
If you would invest 565.00 in Nel ASA on January 5, 2025 and sell it today you would earn a total of 165.00 from holding Nel ASA or generate 29.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Barnes Group vs. Nel ASA
Performance |
| Timeline |
| Barnes Group |
Risk-Adjusted Performance
Excellent
Weak | Strong |
| Nel ASA |
Barnes and Nel ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barnes and Nel ASA
The main advantage of trading using opposite Barnes and Nel ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barnes 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.| Barnes vs. Helios Technologies | Barnes vs. Enpro Industries | Barnes vs. Omega Flex | Barnes vs. Luxfer Holdings PLC |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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