Correlation Between GungHo Online and Norwegian Air
Can any of the company-specific risk be diversified away by investing in both GungHo Online and Norwegian Air 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 GungHo Online and Norwegian Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GungHo Online Entertainment and Norwegian Air Shuttle, you can compare the effects of market volatilities on GungHo Online and Norwegian Air 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 GungHo Online with a short position of Norwegian Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and Norwegian Air.
Diversification Opportunities for GungHo Online and Norwegian Air
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GungHo and Norwegian is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and Norwegian Air Shuttle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norwegian Air Shuttle and GungHo Online 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 GungHo Online Entertainment are associated (or correlated) with Norwegian Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norwegian Air Shuttle has no effect on the direction of GungHo Online i.e., GungHo Online and Norwegian Air go up and down completely randomly.
Pair Corralation between GungHo Online and Norwegian Air
Assuming the 90 days horizon GungHo Online is expected to generate 1.58 times less return on investment than Norwegian Air. But when comparing it to its historical volatility, GungHo Online Entertainment is 1.54 times less risky than Norwegian Air. It trades about 0.01 of its potential returns per unit of risk. Norwegian Air Shuttle is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 98.00 in Norwegian Air Shuttle on September 3, 2024 and sell it today you would lose (2.00) from holding Norwegian Air Shuttle or give up 2.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GungHo Online Entertainment vs. Norwegian Air Shuttle
Performance |
| Timeline |
| GungHo Online Entert |
| Norwegian Air Shuttle |
GungHo Online and Norwegian Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GungHo Online and Norwegian Air
The main advantage of trading using opposite GungHo Online and Norwegian Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, Norwegian Air 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 Norwegian Air will offset losses from the drop in Norwegian Air's long position.| GungHo Online vs. JIAHUA STORES | GungHo Online vs. FUYO GENERAL LEASE | GungHo Online vs. THORNEY TECHS LTD | GungHo Online vs. QURATE RETAIL INC |
| Norwegian Air vs. SHIP HEALTHCARE HLDGINC | Norwegian Air vs. GALENA MINING LTD | Norwegian Air vs. Tianjin Capital Environmental | Norwegian Air vs. BlueScope Steel Limited |
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
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |