Correlation Between NeoMedia Technologies and S A P
Can any of the company-specific risk be diversified away by investing in both NeoMedia Technologies and S A P 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 NeoMedia Technologies and S A P into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NeoMedia Technologies and SAP SE ADR, you can compare the effects of market volatilities on NeoMedia Technologies and S A P 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 NeoMedia Technologies with a short position of S A P. Check out your portfolio center. Please also check ongoing floating volatility patterns of NeoMedia Technologies and S A P.
Diversification Opportunities for NeoMedia Technologies and S A P
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between NeoMedia and SAP is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding NeoMedia Technologies and SAP SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE ADR and NeoMedia Technologies 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 NeoMedia Technologies are associated (or correlated) with S A P. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE ADR has no effect on the direction of NeoMedia Technologies i.e., NeoMedia Technologies and S A P go up and down completely randomly.
Pair Corralation between NeoMedia Technologies and S A P
If you would invest 24,312 in SAP SE ADR on November 3, 2024 and sell it today you would earn a total of 3,294 from holding SAP SE ADR or generate 13.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
NeoMedia Technologies vs. SAP SE ADR
Performance |
| Timeline |
| NeoMedia Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SAP SE ADR |
NeoMedia Technologies and S A P Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NeoMedia Technologies and S A P
The main advantage of trading using opposite NeoMedia Technologies and S A P positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NeoMedia Technologies position performs unexpectedly, S A P 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 S A P will offset losses from the drop in S A P's long position.| NeoMedia Technologies vs. AB International Group | NeoMedia Technologies vs. Peer To Peer | NeoMedia Technologies vs. AppYea Inc | NeoMedia Technologies vs. BASE Inc |
| S A P vs. Tyler Technologies | S A P vs. Roper Technologies, | S A P vs. Cadence Design Systems | S A P vs. PTC Inc |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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