Correlation Between Nomura Holdings and Mercurity Fintech
Can any of the company-specific risk be diversified away by investing in both Nomura Holdings and Mercurity Fintech 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 Mercurity Fintech 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 Mercurity Fintech Holding, you can compare the effects of market volatilities on Nomura Holdings and Mercurity Fintech 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 Mercurity Fintech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nomura Holdings and Mercurity Fintech.
Diversification Opportunities for Nomura Holdings and Mercurity Fintech
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nomura and Mercurity is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Nomura Holdings ADR and Mercurity Fintech Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mercurity Fintech Holding 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 Mercurity Fintech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mercurity Fintech Holding has no effect on the direction of Nomura Holdings i.e., Nomura Holdings and Mercurity Fintech go up and down completely randomly.
Pair Corralation between Nomura Holdings and Mercurity Fintech
Considering the 90-day investment horizon Nomura Holdings is expected to generate 7.02 times less return on investment than Mercurity Fintech. But when comparing it to its historical volatility, Nomura Holdings ADR is 5.36 times less risky than Mercurity Fintech. It trades about 0.06 of its potential returns per unit of risk. Mercurity Fintech Holding is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 88.00 in Mercurity Fintech Holding on August 30, 2024 and sell it today you would earn a total of 522.00 from holding Mercurity Fintech Holding or generate 593.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nomura Holdings ADR vs. Mercurity Fintech Holding
Performance |
| Timeline |
| Nomura Holdings ADR |
| Mercurity Fintech Holding |
Nomura Holdings and Mercurity Fintech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nomura Holdings and Mercurity Fintech
The main advantage of trading using opposite Nomura Holdings and Mercurity Fintech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nomura Holdings position performs unexpectedly, Mercurity Fintech 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 Mercurity Fintech will offset losses from the drop in Mercurity Fintech'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 |
| Mercurity Fintech vs. Scully Royalty | Mercurity Fintech vs. Donnelley Financial Solutions | Mercurity Fintech vs. Heritage Global | Mercurity Fintech vs. Oppenheimer Holdings |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |