Correlation Between Nordson and Greenland Acquisition
Can any of the company-specific risk be diversified away by investing in both Nordson and Greenland Acquisition 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 Nordson and Greenland Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordson and Greenland Acquisition Corp, you can compare the effects of market volatilities on Nordson and Greenland Acquisition 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 Nordson with a short position of Greenland Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordson and Greenland Acquisition.
Diversification Opportunities for Nordson and Greenland Acquisition
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordson and Greenland is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Nordson and Greenland Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenland Acquisition and Nordson 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 Nordson are associated (or correlated) with Greenland Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenland Acquisition has no effect on the direction of Nordson i.e., Nordson and Greenland Acquisition go up and down completely randomly.
Pair Corralation between Nordson and Greenland Acquisition
Given the investment horizon of 90 days Nordson is expected to generate 17.15 times less return on investment than Greenland Acquisition. But when comparing it to its historical volatility, Nordson is 4.21 times less risky than Greenland Acquisition. It trades about 0.0 of its potential returns per unit of risk. Greenland Acquisition Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 261.00 in Greenland Acquisition Corp on September 12, 2024 and sell it today you would lose (49.00) from holding Greenland Acquisition Corp or give up 18.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordson vs. Greenland Acquisition Corp
Performance |
| Timeline |
| Nordson |
| Greenland Acquisition |
Nordson and Greenland Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordson and Greenland Acquisition
The main advantage of trading using opposite Nordson and Greenland Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordson position performs unexpectedly, Greenland Acquisition 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 Greenland Acquisition will offset losses from the drop in Greenland Acquisition's long position.| Nordson vs. Illinois Tool Works | Nordson vs. Pentair PLC | Nordson vs. Parker Hannifin | Nordson vs. Emerson Electric |
| Greenland Acquisition vs. Pentair PLC | Greenland Acquisition vs. Parker Hannifin | Greenland Acquisition vs. Emerson Electric | Greenland Acquisition vs. Smith AO |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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