Correlation Between Lime Technologies and Nordic Iron
Can any of the company-specific risk be diversified away by investing in both Lime Technologies and Nordic Iron 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 Lime Technologies and Nordic Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lime Technologies AB and Nordic Iron Ore, you can compare the effects of market volatilities on Lime Technologies and Nordic Iron 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 Lime Technologies with a short position of Nordic Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lime Technologies and Nordic Iron.
Diversification Opportunities for Lime Technologies and Nordic Iron
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lime and Nordic is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Lime Technologies AB and Nordic Iron Ore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Iron Ore and Lime Technologies 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 Lime Technologies AB are associated (or correlated) with Nordic Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Iron Ore has no effect on the direction of Lime Technologies i.e., Lime Technologies and Nordic Iron go up and down completely randomly.
Pair Corralation between Lime Technologies and Nordic Iron
Assuming the 90 days trading horizon Lime Technologies AB is expected to generate 0.61 times more return on investment than Nordic Iron. However, Lime Technologies AB is 1.63 times less risky than Nordic Iron. It trades about 0.14 of its potential returns per unit of risk. Nordic Iron Ore is currently generating about 0.05 per unit of risk. If you would invest 30,940 in Lime Technologies AB on September 3, 2024 and sell it today you would earn a total of 6,410 from holding Lime Technologies AB or generate 20.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lime Technologies AB vs. Nordic Iron Ore
Performance |
| Timeline |
| Lime Technologies |
| Nordic Iron Ore |
Lime Technologies and Nordic Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lime Technologies and Nordic Iron
The main advantage of trading using opposite Lime Technologies and Nordic Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lime Technologies position performs unexpectedly, Nordic Iron 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 Iron will offset losses from the drop in Nordic Iron's long position.| Lime Technologies vs. Vitec Software Group | Lime Technologies vs. MIPS AB | Lime Technologies vs. Sinch AB | Lime Technologies vs. Stillfront Group AB |
| Nordic Iron vs. Leading Edge Materials | Nordic Iron vs. Alzinova AB | Nordic Iron vs. SaltX Technology Holding | Nordic Iron vs. KABE Group 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |