Correlation Between Nordic American and Caravelle International
Can any of the company-specific risk be diversified away by investing in both Nordic American and Caravelle International 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 American and Caravelle International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic American Tankers and Caravelle International Group, you can compare the effects of market volatilities on Nordic American and Caravelle International 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 American with a short position of Caravelle International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic American and Caravelle International.
Diversification Opportunities for Nordic American and Caravelle International
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordic and Caravelle is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Nordic American Tankers and Caravelle International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caravelle International and Nordic American 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 American Tankers are associated (or correlated) with Caravelle International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caravelle International has no effect on the direction of Nordic American i.e., Nordic American and Caravelle International go up and down completely randomly.
Pair Corralation between Nordic American and Caravelle International
Considering the 90-day investment horizon Nordic American Tankers is expected to under-perform the Caravelle International. But the stock apears to be less risky and, when comparing its historical volatility, Nordic American Tankers is 5.46 times less risky than Caravelle International. The stock trades about -0.07 of its potential returns per unit of risk. The Caravelle International Group is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 59.00 in Caravelle International Group on October 25, 2024 and sell it today you would earn a total of 318.00 from holding Caravelle International Group or generate 538.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic American Tankers vs. Caravelle International Group
Performance |
| Timeline |
| Nordic American Tankers |
| Caravelle International |
Nordic American and Caravelle International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic American and Caravelle International
The main advantage of trading using opposite Nordic American and Caravelle International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic American position performs unexpectedly, Caravelle International 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 Caravelle International will offset losses from the drop in Caravelle International's long position.| Nordic American vs. Genco Shipping Trading | Nordic American vs. Golden Ocean Group | Nordic American vs. Star Bulk Carriers | Nordic American vs. Oceanpal |
| Caravelle International vs. Finnair Oyj | Caravelle International vs. Delta Air Lines | Caravelle International vs. Wizz Air Holdings | Caravelle International vs. Hurco Companies |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |