Correlation Between Nordic Semiconductor and Sekisui Chemical
Can any of the company-specific risk be diversified away by investing in both Nordic Semiconductor and Sekisui Chemical 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 Nordic Semiconductor and Sekisui Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Semiconductor ASA and Sekisui Chemical Co, you can compare the effects of market volatilities on Nordic Semiconductor and Sekisui Chemical 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 Nordic Semiconductor with a short position of Sekisui Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Semiconductor and Sekisui Chemical.
Diversification Opportunities for Nordic Semiconductor and Sekisui Chemical
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nordic and Sekisui is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Semiconductor ASA and Sekisui Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sekisui Chemical and Nordic Semiconductor 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 Nordic Semiconductor ASA are associated (or correlated) with Sekisui Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sekisui Chemical has no effect on the direction of Nordic Semiconductor i.e., Nordic Semiconductor and Sekisui Chemical go up and down completely randomly.
Pair Corralation between Nordic Semiconductor and Sekisui Chemical
Assuming the 90 days horizon Nordic Semiconductor ASA is expected to under-perform the Sekisui Chemical. In addition to that, Nordic Semiconductor is 2.14 times more volatile than Sekisui Chemical Co. It trades about -0.01 of its total potential returns per unit of risk. Sekisui Chemical Co is currently generating about 0.03 per unit of volatility. If you would invest 1,270 in Sekisui Chemical Co on October 19, 2024 and sell it today you would earn a total of 240.00 from holding Sekisui Chemical Co or generate 18.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Semiconductor ASA vs. Sekisui Chemical Co
Performance |
| Timeline |
| Nordic Semiconductor ASA |
| Sekisui Chemical |
Nordic Semiconductor and Sekisui Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Semiconductor and Sekisui Chemical
The main advantage of trading using opposite Nordic Semiconductor and Sekisui Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Semiconductor position performs unexpectedly, Sekisui Chemical 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 Sekisui Chemical will offset losses from the drop in Sekisui Chemical's long position.| Nordic Semiconductor vs. TIANDE CHEMICAL | Nordic Semiconductor vs. KINGBOARD CHEMICAL | Nordic Semiconductor vs. Siamgas And Petrochemicals | Nordic Semiconductor vs. Mitsubishi Gas Chemical |
| Sekisui Chemical vs. Motorcar Parts of | Sekisui Chemical vs. OFFICE DEPOT | Sekisui Chemical vs. NURAN WIRELESS INC | Sekisui Chemical vs. Nordic Semiconductor ASA |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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