Correlation Between Northern Data and Comstock Holding
Can any of the company-specific risk be diversified away by investing in both Northern Data and Comstock Holding 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 Northern Data and Comstock Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Northern Data AG and Comstock Holding Companies, you can compare the effects of market volatilities on Northern Data and Comstock Holding 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 Northern Data with a short position of Comstock Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern Data and Comstock Holding.
Diversification Opportunities for Northern Data and Comstock Holding
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Northern and Comstock is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Northern Data AG and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and Northern Data 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 Northern Data AG are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of Northern Data i.e., Northern Data and Comstock Holding go up and down completely randomly.
Pair Corralation between Northern Data and Comstock Holding
Assuming the 90 days trading horizon Northern Data AG is expected to generate 1.73 times more return on investment than Comstock Holding. However, Northern Data is 1.73 times more volatile than Comstock Holding Companies. It trades about 0.27 of its potential returns per unit of risk. Comstock Holding Companies is currently generating about -0.14 per unit of risk. If you would invest 4,040 in Northern Data AG on October 13, 2024 and sell it today you would earn a total of 895.00 from holding Northern Data AG or generate 22.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northern Data AG vs. Comstock Holding Companies
Performance |
| Timeline |
| Northern Data AG |
| Comstock Holding Com |
Northern Data and Comstock Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern Data and Comstock Holding
The main advantage of trading using opposite Northern Data and Comstock Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern Data position performs unexpectedly, Comstock Holding 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 Comstock Holding will offset losses from the drop in Comstock Holding's long position.| Northern Data vs. Alfa Financial Software | Northern Data vs. ASURE SOFTWARE | Northern Data vs. Check Point Software | Northern Data vs. HK Electric Investments |
| Comstock Holding vs. NAGOYA RAILROAD | Comstock Holding vs. CN DATANG C | Comstock Holding vs. Information Services International Dentsu | Comstock Holding vs. Northern Data AG |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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