Correlation Between Izolacja Jarocin and NGG
Can any of the company-specific risk be diversified away by investing in both Izolacja Jarocin and NGG 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 Izolacja Jarocin and NGG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Izolacja Jarocin SA and NGG, you can compare the effects of market volatilities on Izolacja Jarocin and NGG 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 Izolacja Jarocin with a short position of NGG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Izolacja Jarocin and NGG.
Diversification Opportunities for Izolacja Jarocin and NGG
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Izolacja and NGG is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Izolacja Jarocin SA and NGG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NGG and Izolacja Jarocin 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 Izolacja Jarocin SA are associated (or correlated) with NGG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NGG has no effect on the direction of Izolacja Jarocin i.e., Izolacja Jarocin and NGG go up and down completely randomly.
Pair Corralation between Izolacja Jarocin and NGG
Assuming the 90 days trading horizon Izolacja Jarocin SA is expected to under-perform the NGG. But the stock apears to be less risky and, when comparing its historical volatility, Izolacja Jarocin SA is 1.92 times less risky than NGG. The stock trades about -0.06 of its potential returns per unit of risk. The NGG is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3.26 in NGG on September 2, 2024 and sell it today you would earn a total of 0.12 from holding NGG or generate 3.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Izolacja Jarocin SA vs. NGG
Performance |
| Timeline |
| Izolacja Jarocin |
| NGG |
Izolacja Jarocin and NGG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Izolacja Jarocin and NGG
The main advantage of trading using opposite Izolacja Jarocin and NGG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Izolacja Jarocin position performs unexpectedly, NGG 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 NGG will offset losses from the drop in NGG's long position.| Izolacja Jarocin vs. Banco Santander SA | Izolacja Jarocin vs. UniCredit SpA | Izolacja Jarocin vs. CEZ as | Izolacja Jarocin vs. Polski Koncern Naftowy |
| NGG vs. Asseco Business Solutions | NGG vs. Detalion Games SA | NGG vs. Asseco South Eastern | NGG vs. CFI Holding SA |
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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