Correlation Between FREYR Battery and TDK Corp
Can any of the company-specific risk be diversified away by investing in both FREYR Battery and TDK Corp 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 FREYR Battery and TDK Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FREYR Battery SA and TDK Corp ADR, you can compare the effects of market volatilities on FREYR Battery and TDK Corp 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 FREYR Battery with a short position of TDK Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of FREYR Battery and TDK Corp.
Diversification Opportunities for FREYR Battery and TDK Corp
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FREYR and TDK is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding FREYR Battery SA and TDK Corp ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TDK Corp ADR and FREYR Battery 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 FREYR Battery SA are associated (or correlated) with TDK Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TDK Corp ADR has no effect on the direction of FREYR Battery i.e., FREYR Battery and TDK Corp go up and down completely randomly.
Pair Corralation between FREYR Battery and TDK Corp
If you would invest 3,615 in TDK Corp ADR on October 26, 2024 and sell it today you would earn a total of 0.00 from holding TDK Corp ADR or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
FREYR Battery SA vs. TDK Corp ADR
Performance |
| Timeline |
| FREYR Battery SA |
| TDK Corp ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FREYR Battery and TDK Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FREYR Battery and TDK Corp
The main advantage of trading using opposite FREYR Battery and TDK Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FREYR Battery position performs unexpectedly, TDK Corp 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 TDK Corp will offset losses from the drop in TDK Corp's long position.| FREYR Battery vs. Solid Power | FREYR Battery vs. Enovix Corp | FREYR Battery vs. Microvast Holdings | FREYR Battery vs. LiCycle Holdings Corp |
| TDK Corp vs. Murata Manufacturing Co | TDK Corp vs. OMRON Corp ADR | TDK Corp vs. LGL Group | TDK Corp vs. Data IO |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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