Correlation Between Nexam Chemical and Goodbye Kansas
Can any of the company-specific risk be diversified away by investing in both Nexam Chemical and Goodbye Kansas 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 Nexam Chemical and Goodbye Kansas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nexam Chemical Holding and Goodbye Kansas Group, you can compare the effects of market volatilities on Nexam Chemical and Goodbye Kansas 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 Nexam Chemical with a short position of Goodbye Kansas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexam Chemical and Goodbye Kansas.
Diversification Opportunities for Nexam Chemical and Goodbye Kansas
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nexam and Goodbye is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Nexam Chemical Holding and Goodbye Kansas Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodbye Kansas Group and Nexam Chemical 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 Nexam Chemical Holding are associated (or correlated) with Goodbye Kansas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodbye Kansas Group has no effect on the direction of Nexam Chemical i.e., Nexam Chemical and Goodbye Kansas go up and down completely randomly.
Pair Corralation between Nexam Chemical and Goodbye Kansas
Assuming the 90 days trading horizon Nexam Chemical is expected to generate 19.83 times less return on investment than Goodbye Kansas. But when comparing it to its historical volatility, Nexam Chemical Holding is 5.12 times less risky than Goodbye Kansas. It trades about 0.0 of its potential returns per unit of risk. Goodbye Kansas Group is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 21,419 in Goodbye Kansas Group on September 14, 2024 and sell it today you would lose (21,277) from holding Goodbye Kansas Group or give up 99.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nexam Chemical Holding vs. Goodbye Kansas Group
Performance |
| Timeline |
| Nexam Chemical Holding |
| Goodbye Kansas Group |
Nexam Chemical and Goodbye Kansas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexam Chemical and Goodbye Kansas
The main advantage of trading using opposite Nexam Chemical and Goodbye Kansas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexam Chemical position performs unexpectedly, Goodbye Kansas 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 Goodbye Kansas will offset losses from the drop in Goodbye Kansas' long position.| Nexam Chemical vs. SSAB AB | Nexam Chemical vs. Svenska Cellulosa Aktiebolaget | Nexam Chemical vs. Axfood AB | Nexam Chemical vs. Proact IT Group |
| Goodbye Kansas vs. MTI Investment SE | Goodbye Kansas vs. Kinnevik Investment AB | Goodbye Kansas vs. Nexam Chemical Holding | Goodbye Kansas vs. eEducation Albert AB |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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