Correlation Between Nomura Holdings and Aldel Financial
Can any of the company-specific risk be diversified away by investing in both Nomura Holdings and Aldel Financial 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 Nomura Holdings and Aldel Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nomura Holdings ADR and Aldel Financial II, you can compare the effects of market volatilities on Nomura Holdings and Aldel Financial 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 Nomura Holdings with a short position of Aldel Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nomura Holdings and Aldel Financial.
Diversification Opportunities for Nomura Holdings and Aldel Financial
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nomura and Aldel is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Nomura Holdings ADR and Aldel Financial II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aldel Financial II and Nomura Holdings 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 Nomura Holdings ADR are associated (or correlated) with Aldel Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aldel Financial II has no effect on the direction of Nomura Holdings i.e., Nomura Holdings and Aldel Financial go up and down completely randomly.
Pair Corralation between Nomura Holdings and Aldel Financial
Considering the 90-day investment horizon Nomura Holdings ADR is expected to generate 17.02 times more return on investment than Aldel Financial. However, Nomura Holdings is 17.02 times more volatile than Aldel Financial II. It trades about 0.3 of its potential returns per unit of risk. Aldel Financial II is currently generating about -0.04 per unit of risk. If you would invest 526.00 in Nomura Holdings ADR on August 30, 2024 and sell it today you would earn a total of 67.00 from holding Nomura Holdings ADR or generate 12.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nomura Holdings ADR vs. Aldel Financial II
Performance |
| Timeline |
| Nomura Holdings ADR |
| Aldel Financial II |
Nomura Holdings and Aldel Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nomura Holdings and Aldel Financial
The main advantage of trading using opposite Nomura Holdings and Aldel Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nomura Holdings position performs unexpectedly, Aldel Financial 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 Aldel Financial will offset losses from the drop in Aldel Financial's long position.| Nomura Holdings vs. Perella Weinberg Partners | Nomura Holdings vs. Oppenheimer Holdings | Nomura Holdings vs. Stifel Financial Corp | Nomura Holdings vs. Piper Sandler Companies |
| Aldel Financial vs. Distoken Acquisition | Aldel Financial vs. Voyager Acquisition Corp | Aldel Financial vs. dMY Squared Technology | Aldel Financial vs. YHN Acquisition I |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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