Correlation Between Napatech and Schibsted ASA
Can any of the company-specific risk be diversified away by investing in both Napatech and Schibsted ASA 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 Napatech and Schibsted ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Napatech AS and Schibsted ASA B, you can compare the effects of market volatilities on Napatech and Schibsted ASA 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 Napatech with a short position of Schibsted ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Napatech and Schibsted ASA.
Diversification Opportunities for Napatech and Schibsted ASA
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Napatech and Schibsted is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Napatech AS and Schibsted ASA B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schibsted ASA B and Napatech 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 Napatech AS are associated (or correlated) with Schibsted ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schibsted ASA B has no effect on the direction of Napatech i.e., Napatech and Schibsted ASA go up and down completely randomly.
Pair Corralation between Napatech and Schibsted ASA
Assuming the 90 days trading horizon Napatech AS is expected to under-perform the Schibsted ASA. In addition to that, Napatech is 1.41 times more volatile than Schibsted ASA B. It trades about -0.15 of its total potential returns per unit of risk. Schibsted ASA B is currently generating about -0.02 per unit of volatility. If you would invest 35,120 in Schibsted ASA B on September 12, 2024 and sell it today you would lose (440.00) from holding Schibsted ASA B or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Napatech AS vs. Schibsted ASA B
Performance |
| Timeline |
| Napatech AS |
| Schibsted ASA B |
Napatech and Schibsted ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Napatech and Schibsted ASA
The main advantage of trading using opposite Napatech and Schibsted ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Napatech position performs unexpectedly, Schibsted ASA 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 Schibsted ASA will offset losses from the drop in Schibsted ASA's long position.| Napatech vs. Idex ASA | Napatech vs. Next Biometrics Group | Napatech vs. Polight ASA | Napatech vs. Kitron ASA |
| Schibsted ASA vs. Kitron ASA | Schibsted ASA vs. Olav Thon Eien | Schibsted ASA vs. Kongsberg Gruppen ASA | Schibsted ASA vs. Napatech 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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