Correlation Between Inwido AB and Nordic Waterproofing
Can any of the company-specific risk be diversified away by investing in both Inwido AB and Nordic Waterproofing 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 Inwido AB and Nordic Waterproofing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inwido AB and Nordic Waterproofing Holding, you can compare the effects of market volatilities on Inwido AB and Nordic Waterproofing 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 Inwido AB with a short position of Nordic Waterproofing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inwido AB and Nordic Waterproofing.
Diversification Opportunities for Inwido AB and Nordic Waterproofing
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Inwido and Nordic is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Inwido AB and Nordic Waterproofing Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Waterproofing and Inwido AB 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 Inwido AB are associated (or correlated) with Nordic Waterproofing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Waterproofing has no effect on the direction of Inwido AB i.e., Inwido AB and Nordic Waterproofing go up and down completely randomly.
Pair Corralation between Inwido AB and Nordic Waterproofing
Assuming the 90 days trading horizon Inwido AB is expected to generate 1.27 times more return on investment than Nordic Waterproofing. However, Inwido AB is 1.27 times more volatile than Nordic Waterproofing Holding. It trades about 0.08 of its potential returns per unit of risk. Nordic Waterproofing Holding is currently generating about 0.05 per unit of risk. If you would invest 9,473 in Inwido AB on January 20, 2025 and sell it today you would earn a total of 9,557 from holding Inwido AB or generate 100.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.37% |
| Values | Daily Returns |
Inwido AB vs. Nordic Waterproofing Holding
Performance |
| Timeline |
| Inwido AB |
| Nordic Waterproofing |
Risk-Adjusted Performance
Modest
Weak | Strong |
Inwido AB and Nordic Waterproofing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inwido AB and Nordic Waterproofing
The main advantage of trading using opposite Inwido AB and Nordic Waterproofing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inwido AB position performs unexpectedly, Nordic Waterproofing 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 Nordic Waterproofing will offset losses from the drop in Nordic Waterproofing's long position.| Inwido AB vs. Upsales Technology AB | Inwido AB vs. Invisio Communications AB | Inwido AB vs. Media and Games | Inwido AB vs. GiG Software PLC |
| Nordic Waterproofing vs. Inwido AB | Nordic Waterproofing vs. Byggmax Group AB | Nordic Waterproofing vs. AQ Group AB | Nordic Waterproofing vs. Garo AB |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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