Correlation Between NH Foods and INFICON Holding
Can any of the company-specific risk be diversified away by investing in both NH Foods and INFICON Holding 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 NH Foods and INFICON Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Foods Ltd and INFICON Holding AG, you can compare the effects of market volatilities on NH Foods and INFICON Holding 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 NH Foods with a short position of INFICON Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Foods and INFICON Holding.
Diversification Opportunities for NH Foods and INFICON Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NIPMY and INFICON is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NH Foods Ltd and INFICON Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INFICON Holding AG and NH Foods 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 NH Foods Ltd are associated (or correlated) with INFICON Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INFICON Holding AG has no effect on the direction of NH Foods i.e., NH Foods and INFICON Holding go up and down completely randomly.
Pair Corralation between NH Foods and INFICON Holding
If you would invest 1,700 in NH Foods Ltd on September 13, 2024 and sell it today you would earn a total of 0.00 from holding NH Foods Ltd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
NH Foods Ltd vs. INFICON Holding AG
Performance |
| Timeline |
| NH Foods |
| INFICON Holding AG |
NH Foods and INFICON Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Foods and INFICON Holding
The main advantage of trading using opposite NH Foods and INFICON Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Foods position performs unexpectedly, INFICON Holding 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 INFICON Holding will offset losses from the drop in INFICON Holding's long position.The idea behind NH Foods Ltd and INFICON Holding AG pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| INFICON Holding vs. Copa Holdings SA | INFICON Holding vs. United Airlines Holdings | INFICON Holding vs. Delta Air Lines | INFICON Holding vs. SkyWest |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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