Correlation Between Newcap Holding and Agat Ejendomme
Can any of the company-specific risk be diversified away by investing in both Newcap Holding and Agat Ejendomme 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 Newcap Holding and Agat Ejendomme into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newcap Holding AS and Agat Ejendomme AS, you can compare the effects of market volatilities on Newcap Holding and Agat Ejendomme 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 Newcap Holding with a short position of Agat Ejendomme. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newcap Holding and Agat Ejendomme.
Diversification Opportunities for Newcap Holding and Agat Ejendomme
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Newcap and Agat is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Newcap Holding AS and Agat Ejendomme AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agat Ejendomme AS and Newcap Holding 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 Newcap Holding AS are associated (or correlated) with Agat Ejendomme. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agat Ejendomme AS has no effect on the direction of Newcap Holding i.e., Newcap Holding and Agat Ejendomme go up and down completely randomly.
Pair Corralation between Newcap Holding and Agat Ejendomme
Assuming the 90 days trading horizon Newcap Holding AS is expected to generate 1.84 times more return on investment than Agat Ejendomme. However, Newcap Holding is 1.84 times more volatile than Agat Ejendomme AS. It trades about 0.04 of its potential returns per unit of risk. Agat Ejendomme AS is currently generating about -0.22 per unit of risk. If you would invest 9.65 in Newcap Holding AS on August 25, 2024 and sell it today you would earn a total of 0.15 from holding Newcap Holding AS or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Newcap Holding AS vs. Agat Ejendomme AS
Performance |
| Timeline |
| Newcap Holding AS |
| Agat Ejendomme AS |
Newcap Holding and Agat Ejendomme Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newcap Holding and Agat Ejendomme
The main advantage of trading using opposite Newcap Holding and Agat Ejendomme positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newcap Holding position performs unexpectedly, Agat Ejendomme 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 Agat Ejendomme will offset losses from the drop in Agat Ejendomme's long position.| Newcap Holding vs. Dataproces Group AS | Newcap Holding vs. cBrain AS | Newcap Holding vs. ALK Abell AS | Newcap Holding vs. ChemoMetec AS |
| Agat Ejendomme vs. Cemat AS | Agat Ejendomme vs. Columbus AS | Agat Ejendomme vs. Harboes Bryggeri AS | Agat Ejendomme vs. Copenhagen Capital AS |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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