Correlation Between Computer and NTG Nordic
Can any of the company-specific risk be diversified away by investing in both Computer and NTG Nordic 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 Computer and NTG Nordic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Computer And Technologies and NTG Nordic Transport, you can compare the effects of market volatilities on Computer and NTG Nordic 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 Computer with a short position of NTG Nordic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Computer and NTG Nordic.
Diversification Opportunities for Computer and NTG Nordic
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Computer and NTG is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Computer And Technologies and NTG Nordic Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NTG Nordic Transport and Computer 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 Computer And Technologies are associated (or correlated) with NTG Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NTG Nordic Transport has no effect on the direction of Computer i.e., Computer and NTG Nordic go up and down completely randomly.
Pair Corralation between Computer and NTG Nordic
Assuming the 90 days horizon Computer And Technologies is expected to generate 4.12 times more return on investment than NTG Nordic. However, Computer is 4.12 times more volatile than NTG Nordic Transport. It trades about 0.21 of its potential returns per unit of risk. NTG Nordic Transport is currently generating about 0.13 per unit of risk. If you would invest 17.00 in Computer And Technologies on November 27, 2024 and sell it today you would earn a total of 4.00 from holding Computer And Technologies or generate 23.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Computer And Technologies vs. NTG Nordic Transport
Performance |
| Timeline |
| Computer And Technologies |
| NTG Nordic Transport |
Computer and NTG Nordic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Computer and NTG Nordic
The main advantage of trading using opposite Computer and NTG Nordic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Computer position performs unexpectedly, NTG Nordic 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 NTG Nordic will offset losses from the drop in NTG Nordic's long position.| Computer vs. CENTURIA OFFICE REIT | Computer vs. NXP Semiconductors NV | Computer vs. American Airlines Group | Computer vs. Gol Intelligent Airlines |
| NTG Nordic vs. Mitsui Chemicals | NTG Nordic vs. De Grey Mining | NTG Nordic vs. Calibre Mining Corp | NTG Nordic vs. MUTUIONLINE |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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