Correlation Between Coda Octopus and Noranda Aluminum
Can any of the company-specific risk be diversified away by investing in both Coda Octopus and Noranda Aluminum 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 Coda Octopus and Noranda Aluminum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coda Octopus Group and Noranda Aluminum Holding, you can compare the effects of market volatilities on Coda Octopus and Noranda Aluminum 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 Coda Octopus with a short position of Noranda Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coda Octopus and Noranda Aluminum.
Diversification Opportunities for Coda Octopus and Noranda Aluminum
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coda and Noranda is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Coda Octopus Group and Noranda Aluminum Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Noranda Aluminum Holding and Coda Octopus 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 Coda Octopus Group are associated (or correlated) with Noranda Aluminum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Noranda Aluminum Holding has no effect on the direction of Coda Octopus i.e., Coda Octopus and Noranda Aluminum go up and down completely randomly.
Pair Corralation between Coda Octopus and Noranda Aluminum
If you would invest 614.00 in Coda Octopus Group on September 14, 2024 and sell it today you would earn a total of 239.00 from holding Coda Octopus Group or generate 38.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Coda Octopus Group vs. Noranda Aluminum Holding
Performance |
| Timeline |
| Coda Octopus Group |
| Noranda Aluminum Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Coda Octopus and Noranda Aluminum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coda Octopus and Noranda Aluminum
The main advantage of trading using opposite Coda Octopus and Noranda Aluminum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coda Octopus position performs unexpectedly, Noranda Aluminum 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 Noranda Aluminum will offset losses from the drop in Noranda Aluminum's long position.| Coda Octopus vs. Ducommun Incorporated | Coda Octopus vs. Park Electrochemical | Coda Octopus vs. National Presto Industries | Coda Octopus vs. Astronics |
| Noranda Aluminum vs. Coda Octopus Group | Noranda Aluminum vs. Neogen | Noranda Aluminum vs. Plexus Corp | Noranda Aluminum vs. ClearOne |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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