Correlation Between CALNEX SOLUT and Norsk Hydro
Can any of the company-specific risk be diversified away by investing in both CALNEX SOLUT and Norsk Hydro 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 CALNEX SOLUT and Norsk Hydro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CALNEX SOLUT LS and Norsk Hydro ASA, you can compare the effects of market volatilities on CALNEX SOLUT and Norsk Hydro 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 CALNEX SOLUT with a short position of Norsk Hydro. Check out your portfolio center. Please also check ongoing floating volatility patterns of CALNEX SOLUT and Norsk Hydro.
Diversification Opportunities for CALNEX SOLUT and Norsk Hydro
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CALNEX and Norsk is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding CALNEX SOLUT LS and Norsk Hydro ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norsk Hydro ASA and CALNEX SOLUT 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 CALNEX SOLUT LS are associated (or correlated) with Norsk Hydro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norsk Hydro ASA has no effect on the direction of CALNEX SOLUT i.e., CALNEX SOLUT and Norsk Hydro go up and down completely randomly.
Pair Corralation between CALNEX SOLUT and Norsk Hydro
Assuming the 90 days horizon CALNEX SOLUT LS is expected to generate 0.9 times more return on investment than Norsk Hydro. However, CALNEX SOLUT LS is 1.11 times less risky than Norsk Hydro. It trades about 0.06 of its potential returns per unit of risk. Norsk Hydro ASA is currently generating about 0.01 per unit of risk. If you would invest 60.00 in CALNEX SOLUT LS on November 7, 2024 and sell it today you would earn a total of 15.00 from holding CALNEX SOLUT LS or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.52% |
| Values | Daily Returns |
CALNEX SOLUT LS vs. Norsk Hydro ASA
Performance |
| Timeline |
| CALNEX SOLUT LS |
| Norsk Hydro ASA |
CALNEX SOLUT and Norsk Hydro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CALNEX SOLUT and Norsk Hydro
The main advantage of trading using opposite CALNEX SOLUT and Norsk Hydro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CALNEX SOLUT position performs unexpectedly, Norsk Hydro 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 Norsk Hydro will offset losses from the drop in Norsk Hydro's long position.| CALNEX SOLUT vs. BANK OF CHINA | CALNEX SOLUT vs. REVO INSURANCE SPA | CALNEX SOLUT vs. PACIFIC ONLINE | CALNEX SOLUT vs. YATRA ONLINE DL 0001 |
| Norsk Hydro vs. Norsk Hydro ASA | Norsk Hydro vs. Aluminum of | Norsk Hydro vs. Alcoa Corp | Norsk Hydro vs. AMAG Austria Metall |
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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