Correlation Between Data Modul and Nib Holdings
Can any of the company-specific risk be diversified away by investing in both Data Modul and Nib Holdings 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 Data Modul and Nib Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Data Modul AG and nib holdings limited, you can compare the effects of market volatilities on Data Modul and Nib Holdings 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 Data Modul with a short position of Nib Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Data Modul and Nib Holdings.
Diversification Opportunities for Data Modul and Nib Holdings
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Data and Nib is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Data Modul AG and nib holdings limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on nib holdings limited and Data Modul 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 Data Modul AG are associated (or correlated) with Nib Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of nib holdings limited has no effect on the direction of Data Modul i.e., Data Modul and Nib Holdings go up and down completely randomly.
Pair Corralation between Data Modul and Nib Holdings
Assuming the 90 days trading horizon Data Modul AG is expected to under-perform the Nib Holdings. In addition to that, Data Modul is 1.8 times more volatile than nib holdings limited. It trades about -0.08 of its total potential returns per unit of risk. nib holdings limited is currently generating about 0.06 per unit of volatility. If you would invest 320.00 in nib holdings limited on October 23, 2024 and sell it today you would earn a total of 4.00 from holding nib holdings limited or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Data Modul AG vs. nib holdings limited
Performance |
| Timeline |
| Data Modul AG |
| nib holdings limited |
Data Modul and Nib Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Data Modul and Nib Holdings
The main advantage of trading using opposite Data Modul and Nib Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Data Modul position performs unexpectedly, Nib Holdings 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 Nib Holdings will offset losses from the drop in Nib Holdings' long position.The idea behind Data Modul AG and nib holdings limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Nib Holdings vs. Datadog | Nib Holdings vs. CN DATANG C | Nib Holdings vs. DATAGROUP SE | Nib Holdings vs. Linedata Services SA |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |