Correlation Between Norwegian Air and SoftOx Solutions
Can any of the company-specific risk be diversified away by investing in both Norwegian Air and SoftOx Solutions 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 Norwegian Air and SoftOx Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Norwegian Air Shuttle and SoftOx Solutions AS, you can compare the effects of market volatilities on Norwegian Air and SoftOx Solutions 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 Norwegian Air with a short position of SoftOx Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Norwegian Air and SoftOx Solutions.
Diversification Opportunities for Norwegian Air and SoftOx Solutions
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Norwegian and SoftOx is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Norwegian Air Shuttle and SoftOx Solutions AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SoftOx Solutions and Norwegian Air 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 Norwegian Air Shuttle are associated (or correlated) with SoftOx Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SoftOx Solutions has no effect on the direction of Norwegian Air i.e., Norwegian Air and SoftOx Solutions go up and down completely randomly.
Pair Corralation between Norwegian Air and SoftOx Solutions
Assuming the 90 days trading horizon Norwegian Air Shuttle is expected to generate 0.27 times more return on investment than SoftOx Solutions. However, Norwegian Air Shuttle is 3.7 times less risky than SoftOx Solutions. It trades about 0.03 of its potential returns per unit of risk. SoftOx Solutions AS is currently generating about -0.1 per unit of risk. If you would invest 847.00 in Norwegian Air Shuttle on September 2, 2024 and sell it today you would earn a total of 278.00 from holding Norwegian Air Shuttle or generate 32.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Norwegian Air Shuttle vs. SoftOx Solutions AS
Performance |
| Timeline |
| Norwegian Air Shuttle |
| SoftOx Solutions |
Norwegian Air and SoftOx Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Norwegian Air and SoftOx Solutions
The main advantage of trading using opposite Norwegian Air and SoftOx Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Norwegian Air position performs unexpectedly, SoftOx Solutions 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 SoftOx Solutions will offset losses from the drop in SoftOx Solutions' long position.| Norwegian Air vs. REC Silicon ASA | Norwegian Air vs. Aker Horizons AS | Norwegian Air vs. Aker BP ASA | Norwegian Air vs. MPC Container Ships |
| SoftOx Solutions vs. Sogn Sparebank | SoftOx Solutions vs. Bien Sparebank ASA | SoftOx Solutions vs. Norwegian Air Shuttle | SoftOx Solutions vs. Cloudberry Clean Energy |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |