Correlation Between FEMALE HEALTH and NorAm Drilling
Can any of the company-specific risk be diversified away by investing in both FEMALE HEALTH and NorAm Drilling 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 FEMALE HEALTH and NorAm Drilling into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FEMALE HEALTH and NorAm Drilling AS, you can compare the effects of market volatilities on FEMALE HEALTH and NorAm Drilling 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 FEMALE HEALTH with a short position of NorAm Drilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of FEMALE HEALTH and NorAm Drilling.
Diversification Opportunities for FEMALE HEALTH and NorAm Drilling
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FEMALE and NorAm is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding FEMALE HEALTH and NorAm Drilling AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NorAm Drilling AS and FEMALE HEALTH 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 FEMALE HEALTH are associated (or correlated) with NorAm Drilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NorAm Drilling AS has no effect on the direction of FEMALE HEALTH i.e., FEMALE HEALTH and NorAm Drilling go up and down completely randomly.
Pair Corralation between FEMALE HEALTH and NorAm Drilling
Assuming the 90 days trading horizon FEMALE HEALTH is expected to under-perform the NorAm Drilling. In addition to that, FEMALE HEALTH is 1.31 times more volatile than NorAm Drilling AS. It trades about -0.04 of its total potential returns per unit of risk. NorAm Drilling AS is currently generating about 0.16 per unit of volatility. If you would invest 15.00 in NorAm Drilling AS on September 4, 2024 and sell it today you would earn a total of 277.00 from holding NorAm Drilling AS or generate 1846.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 89.9% |
| Values | Daily Returns |
FEMALE HEALTH vs. NorAm Drilling AS
Performance |
| Timeline |
| FEMALE HEALTH |
| NorAm Drilling AS |
FEMALE HEALTH and NorAm Drilling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FEMALE HEALTH and NorAm Drilling
The main advantage of trading using opposite FEMALE HEALTH and NorAm Drilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FEMALE HEALTH position performs unexpectedly, NorAm Drilling 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 NorAm Drilling will offset losses from the drop in NorAm Drilling's long position.| FEMALE HEALTH vs. TOTAL GABON | FEMALE HEALTH vs. Walgreens Boots Alliance | FEMALE HEALTH vs. Peak Resources Limited |
| NorAm Drilling vs. LIFENET INSURANCE CO | NorAm Drilling vs. Thai Beverage Public | NorAm Drilling vs. QBE Insurance Group | NorAm Drilling vs. Selective Insurance Group |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |