Correlation Between AP Mller and Novo Nordisk
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By analyzing existing cross correlation between AP Mller and Novo Nordisk AS, you can compare the effects of market volatilities on AP Mller and Novo Nordisk 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 AP Mller with a short position of Novo Nordisk. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Mller and Novo Nordisk.
Diversification Opportunities for AP Mller and Novo Nordisk
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MAERSK-A and Novo is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding AP Mller and Novo Nordisk AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Novo Nordisk AS and AP Mller 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 AP Mller are associated (or correlated) with Novo Nordisk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Novo Nordisk AS has no effect on the direction of AP Mller i.e., AP Mller and Novo Nordisk go up and down completely randomly.
Pair Corralation between AP Mller and Novo Nordisk
Assuming the 90 days trading horizon AP Mller is expected to generate 1.45 times more return on investment than Novo Nordisk. However, AP Mller is 1.45 times more volatile than Novo Nordisk AS. It trades about 0.17 of its potential returns per unit of risk. Novo Nordisk AS is currently generating about -0.06 per unit of risk. If you would invest 1,004,000 in AP Mller on August 28, 2024 and sell it today you would earn a total of 119,000 from holding AP Mller or generate 11.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AP Mller vs. Novo Nordisk AS
Performance |
| Timeline |
| AP Mller |
| Novo Nordisk AS |
AP Mller and Novo Nordisk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Mller and Novo Nordisk
The main advantage of trading using opposite AP Mller and Novo Nordisk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Mller position performs unexpectedly, Novo Nordisk 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 Novo Nordisk will offset losses from the drop in Novo Nordisk's long position.| AP Mller vs. AP Mller | AP Mller vs. DSV Panalpina AS | AP Mller vs. Danske Bank AS | AP Mller vs. FLSmidth Co |
| Novo Nordisk vs. Vestas Wind Systems | Novo Nordisk vs. Danske Bank AS | Novo Nordisk vs. Bavarian Nordic | Novo Nordisk vs. DSV Panalpina AS |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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