Correlation Between Nexam Chemical and Zinzino AB
Can any of the company-specific risk be diversified away by investing in both Nexam Chemical and Zinzino AB 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 Zinzino AB 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 Zinzino AB Series, you can compare the effects of market volatilities on Nexam Chemical and Zinzino AB 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 Zinzino AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexam Chemical and Zinzino AB.
Diversification Opportunities for Nexam Chemical and Zinzino AB
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nexam and Zinzino is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Nexam Chemical Holding and Zinzino AB Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zinzino AB Series 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 Zinzino AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zinzino AB Series has no effect on the direction of Nexam Chemical i.e., Nexam Chemical and Zinzino AB go up and down completely randomly.
Pair Corralation between Nexam Chemical and Zinzino AB
Assuming the 90 days trading horizon Nexam Chemical Holding is expected to generate 1.4 times more return on investment than Zinzino AB. However, Nexam Chemical is 1.4 times more volatile than Zinzino AB Series. It trades about 0.07 of its potential returns per unit of risk. Zinzino AB Series is currently generating about 0.07 per unit of risk. If you would invest 301.00 in Nexam Chemical Holding on August 29, 2024 and sell it today you would earn a total of 86.00 from holding Nexam Chemical Holding or generate 28.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nexam Chemical Holding vs. Zinzino AB Series
Performance |
| Timeline |
| Nexam Chemical Holding |
| Zinzino AB Series |
Nexam Chemical and Zinzino AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexam Chemical and Zinzino AB
The main advantage of trading using opposite Nexam Chemical and Zinzino AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexam Chemical position performs unexpectedly, Zinzino AB 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 Zinzino AB will offset losses from the drop in Zinzino AB's long position.| Nexam Chemical vs. Bjorn Borg AB | Nexam Chemical vs. Diadrom Holding AB | Nexam Chemical vs. Anoto Group AB | Nexam Chemical vs. Cloetta AB |
| Zinzino AB vs. eWork Group AB | Zinzino AB vs. Softronic AB | Zinzino AB vs. Niloerngruppen AB Series | Zinzino AB vs. Transtema Group 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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