Correlation Between INTERSHOP Communications and NOVAGOLD RESOURCES
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By analyzing existing cross correlation between INTERSHOP Communications Aktiengesellschaft and NOVAGOLD RESOURCES, you can compare the effects of market volatilities on INTERSHOP Communications and NOVAGOLD RESOURCES 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 INTERSHOP Communications with a short position of NOVAGOLD RESOURCES. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTERSHOP Communications and NOVAGOLD RESOURCES.
Diversification Opportunities for INTERSHOP Communications and NOVAGOLD RESOURCES
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between INTERSHOP and NOVAGOLD is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding INTERSHOP Communications Aktie and NOVAGOLD RESOURCES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NOVAGOLD RESOURCES and INTERSHOP Communications 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 INTERSHOP Communications Aktiengesellschaft are associated (or correlated) with NOVAGOLD RESOURCES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NOVAGOLD RESOURCES has no effect on the direction of INTERSHOP Communications i.e., INTERSHOP Communications and NOVAGOLD RESOURCES go up and down completely randomly.
Pair Corralation between INTERSHOP Communications and NOVAGOLD RESOURCES
Assuming the 90 days trading horizon INTERSHOP Communications Aktiengesellschaft is expected to under-perform the NOVAGOLD RESOURCES. But the stock apears to be less risky and, when comparing its historical volatility, INTERSHOP Communications Aktiengesellschaft is 1.51 times less risky than NOVAGOLD RESOURCES. The stock trades about -0.02 of its potential returns per unit of risk. The NOVAGOLD RESOURCES is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 306.00 in NOVAGOLD RESOURCES on September 19, 2024 and sell it today you would earn a total of 16.00 from holding NOVAGOLD RESOURCES or generate 5.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
INTERSHOP Communications Aktie vs. NOVAGOLD RESOURCES
Performance |
| Timeline |
| INTERSHOP Communications |
| NOVAGOLD RESOURCES |
INTERSHOP Communications and NOVAGOLD RESOURCES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTERSHOP Communications and NOVAGOLD RESOURCES
The main advantage of trading using opposite INTERSHOP Communications and NOVAGOLD RESOURCES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTERSHOP Communications position performs unexpectedly, NOVAGOLD RESOURCES 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 NOVAGOLD RESOURCES will offset losses from the drop in NOVAGOLD RESOURCES's long position.| INTERSHOP Communications vs. Superior Plus Corp | INTERSHOP Communications vs. SIVERS SEMICONDUCTORS AB | INTERSHOP Communications vs. Norsk Hydro ASA | INTERSHOP Communications vs. Reliance Steel Aluminum |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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