Correlation Between Cboe UK and Norwegian Air
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By analyzing existing cross correlation between Cboe UK Consumer and Norwegian Air Shuttle, you can compare the effects of market volatilities on Cboe UK and Norwegian Air 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 Cboe UK with a short position of Norwegian Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cboe UK and Norwegian Air.
Diversification Opportunities for Cboe UK and Norwegian Air
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cboe and Norwegian is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Cboe UK Consumer and Norwegian Air Shuttle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norwegian Air Shuttle and Cboe UK 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 Cboe UK Consumer are associated (or correlated) with Norwegian Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norwegian Air Shuttle has no effect on the direction of Cboe UK i.e., Cboe UK and Norwegian Air go up and down completely randomly.
Pair Corralation between Cboe UK and Norwegian Air
Assuming the 90 days trading horizon Cboe UK Consumer is expected to generate 0.35 times more return on investment than Norwegian Air. However, Cboe UK Consumer is 2.85 times less risky than Norwegian Air. It trades about 0.07 of its potential returns per unit of risk. Norwegian Air Shuttle is currently generating about 0.01 per unit of risk. If you would invest 2,559,267 in Cboe UK Consumer on August 31, 2024 and sell it today you would earn a total of 701,035 from holding Cboe UK Consumer or generate 27.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.95% |
| Values | Daily Returns |
Cboe UK Consumer vs. Norwegian Air Shuttle
Performance |
| Timeline |
Cboe UK and Norwegian Air Volatility Contrast
Predicted Return Density |
| Returns |
Cboe UK Consumer
Pair trading matchups for Cboe UK
Norwegian Air Shuttle
Pair trading matchups for Norwegian Air
Pair Trading with Cboe UK and Norwegian Air
The main advantage of trading using opposite Cboe UK and Norwegian Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cboe UK position performs unexpectedly, Norwegian Air 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 Norwegian Air will offset losses from the drop in Norwegian Air's long position.| Cboe UK vs. Lendinvest PLC | Cboe UK vs. Monster Beverage Corp | Cboe UK vs. Cembra Money Bank | Cboe UK vs. UNIQA Insurance Group |
| Norwegian Air vs. Axfood AB | Norwegian Air vs. United Internet AG | Norwegian Air vs. Ebro Foods | Norwegian Air vs. Associated British Foods |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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