Correlation Between Nightingale Health and Trainers House
Can any of the company-specific risk be diversified away by investing in both Nightingale Health and Trainers House 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 Nightingale Health and Trainers House into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nightingale Health Oyj and Trainers House Oyj, you can compare the effects of market volatilities on Nightingale Health and Trainers House 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 Nightingale Health with a short position of Trainers House. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nightingale Health and Trainers House.
Diversification Opportunities for Nightingale Health and Trainers House
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nightingale and Trainers is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Nightingale Health Oyj and Trainers House Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trainers House Oyj and Nightingale 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 Nightingale Health Oyj are associated (or correlated) with Trainers House. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trainers House Oyj has no effect on the direction of Nightingale Health i.e., Nightingale Health and Trainers House go up and down completely randomly.
Pair Corralation between Nightingale Health and Trainers House
Assuming the 90 days trading horizon Nightingale Health Oyj is expected to generate 1.33 times more return on investment than Trainers House. However, Nightingale Health is 1.33 times more volatile than Trainers House Oyj. It trades about 0.1 of its potential returns per unit of risk. Trainers House Oyj is currently generating about -0.07 per unit of risk. If you would invest 116.00 in Nightingale Health Oyj on August 26, 2024 and sell it today you would earn a total of 160.00 from holding Nightingale Health Oyj or generate 137.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nightingale Health Oyj vs. Trainers House Oyj
Performance |
| Timeline |
| Nightingale Health Oyj |
| Trainers House Oyj |
Nightingale Health and Trainers House Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nightingale Health and Trainers House
The main advantage of trading using opposite Nightingale Health and Trainers House positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nightingale Health position performs unexpectedly, Trainers House 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 Trainers House will offset losses from the drop in Trainers House's long position.| Nightingale Health vs. Vaisala Oyj A | Nightingale Health vs. CapMan Oyj B | Nightingale Health vs. HKFoods Oyj A | Nightingale Health vs. KONE Oyj |
| Trainers House vs. Aktia Bank Abp | Trainers House vs. Alandsbanken Abp B | Trainers House vs. Alandsbanken Abp A | Trainers House vs. Sampo Oyj A |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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