Correlation Between NACCO Industries and Stora Enso
Can any of the company-specific risk be diversified away by investing in both NACCO Industries and Stora Enso 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 NACCO Industries and Stora Enso into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NACCO Industries and Stora Enso Oyj, you can compare the effects of market volatilities on NACCO Industries and Stora Enso 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 NACCO Industries with a short position of Stora Enso. Check out your portfolio center. Please also check ongoing floating volatility patterns of NACCO Industries and Stora Enso.
Diversification Opportunities for NACCO Industries and Stora Enso
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NACCO and Stora is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding NACCO Industries and Stora Enso Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stora Enso Oyj and NACCO Industries 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 NACCO Industries are associated (or correlated) with Stora Enso. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stora Enso Oyj has no effect on the direction of NACCO Industries i.e., NACCO Industries and Stora Enso go up and down completely randomly.
Pair Corralation between NACCO Industries and Stora Enso
If you would invest 2,758 in NACCO Industries on August 29, 2024 and sell it today you would earn a total of 428.00 from holding NACCO Industries or generate 15.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
NACCO Industries vs. Stora Enso Oyj
Performance |
| Timeline |
| NACCO Industries |
| Stora Enso Oyj |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
NACCO Industries and Stora Enso Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NACCO Industries and Stora Enso
The main advantage of trading using opposite NACCO Industries and Stora Enso positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NACCO Industries position performs unexpectedly, Stora Enso 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 Stora Enso will offset losses from the drop in Stora Enso's long position.| NACCO Industries vs. Alliance Resource Partners | NACCO Industries vs. Hallador Energy | NACCO Industries vs. Consol Energy | NACCO Industries vs. Indo Tambangraya Megah |
| Stora Enso vs. Nine Dragons Paper | Stora Enso vs. Canfor Pulp Products | Stora Enso vs. Mondi PLC ADR | Stora Enso vs. Clearwater Paper |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| CEOs Directory Screen CEOs from public companies around the world |