Correlation Between Nufarm Finance and Clime Investment
Can any of the company-specific risk be diversified away by investing in both Nufarm Finance and Clime Investment 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 Nufarm Finance and Clime Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nufarm Finance NZ and Clime Investment Management, you can compare the effects of market volatilities on Nufarm Finance and Clime Investment 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 Nufarm Finance with a short position of Clime Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nufarm Finance and Clime Investment.
Diversification Opportunities for Nufarm Finance and Clime Investment
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nufarm and Clime is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Nufarm Finance NZ and Clime Investment Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clime Investment Man and Nufarm Finance 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 Nufarm Finance NZ are associated (or correlated) with Clime Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clime Investment Man has no effect on the direction of Nufarm Finance i.e., Nufarm Finance and Clime Investment go up and down completely randomly.
Pair Corralation between Nufarm Finance and Clime Investment
If you would invest 9,080 in Nufarm Finance NZ on August 29, 2024 and sell it today you would earn a total of 60.00 from holding Nufarm Finance NZ or generate 0.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nufarm Finance NZ vs. Clime Investment Management
Performance |
| Timeline |
| Nufarm Finance NZ |
| Clime Investment Man |
Nufarm Finance and Clime Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nufarm Finance and Clime Investment
The main advantage of trading using opposite Nufarm Finance and Clime Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nufarm Finance position performs unexpectedly, Clime Investment 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 Clime Investment will offset losses from the drop in Clime Investment's long position.| Nufarm Finance vs. Westpac Banking | Nufarm Finance vs. Ecofibre | Nufarm Finance vs. iShares Global Healthcare | Nufarm Finance vs. Ridley |
| Clime Investment vs. National Australia Bank | Clime Investment vs. National Australia Bank | Clime Investment vs. Westpac Banking | Clime Investment vs. National Australia Bank |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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