Correlation Between New Nordic and OptiCept Technologies
Can any of the company-specific risk be diversified away by investing in both New Nordic and OptiCept Technologies 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 New Nordic and OptiCept Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New Nordic Healthbrands and OptiCept Technologies AB, you can compare the effects of market volatilities on New Nordic and OptiCept Technologies 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 New Nordic with a short position of OptiCept Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Nordic and OptiCept Technologies.
Diversification Opportunities for New Nordic and OptiCept Technologies
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between New and OptiCept is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding New Nordic Healthbrands and OptiCept Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OptiCept Technologies and New Nordic 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 New Nordic Healthbrands are associated (or correlated) with OptiCept Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OptiCept Technologies has no effect on the direction of New Nordic i.e., New Nordic and OptiCept Technologies go up and down completely randomly.
Pair Corralation between New Nordic and OptiCept Technologies
Assuming the 90 days trading horizon New Nordic Healthbrands is expected to generate 0.69 times more return on investment than OptiCept Technologies. However, New Nordic Healthbrands is 1.45 times less risky than OptiCept Technologies. It trades about -0.07 of its potential returns per unit of risk. OptiCept Technologies AB is currently generating about -0.09 per unit of risk. If you would invest 1,530 in New Nordic Healthbrands on November 7, 2024 and sell it today you would lose (70.00) from holding New Nordic Healthbrands or give up 4.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Nordic Healthbrands vs. OptiCept Technologies AB
Performance |
| Timeline |
| New Nordic Healthbrands |
| OptiCept Technologies |
New Nordic and OptiCept Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Nordic and OptiCept Technologies
The main advantage of trading using opposite New Nordic and OptiCept Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Nordic position performs unexpectedly, OptiCept Technologies 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 OptiCept Technologies will offset losses from the drop in OptiCept Technologies' long position.| New Nordic vs. Stille AB | New Nordic vs. Midsona AB | New Nordic vs. Precio Fishbone AB | New Nordic vs. C Rad AB |
| OptiCept Technologies vs. 24SevenOffice Scandinavia AB | OptiCept Technologies vs. Viaplay Group AB | OptiCept Technologies vs. Invisio Communications AB | OptiCept Technologies vs. TF Bank 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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