Correlation Between NI Holdings and Nomura Holdings
Can any of the company-specific risk be diversified away by investing in both NI Holdings and Nomura Holdings 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 NI Holdings and Nomura Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NI Holdings and Nomura Holdings ADR, you can compare the effects of market volatilities on NI Holdings and Nomura Holdings 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 NI Holdings with a short position of Nomura Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of NI Holdings and Nomura Holdings.
Diversification Opportunities for NI Holdings and Nomura Holdings
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NODK and Nomura is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding NI Holdings and Nomura Holdings ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nomura Holdings ADR and NI 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 NI Holdings are associated (or correlated) with Nomura Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nomura Holdings ADR has no effect on the direction of NI Holdings i.e., NI Holdings and Nomura Holdings go up and down completely randomly.
Pair Corralation between NI Holdings and Nomura Holdings
Given the investment horizon of 90 days NI Holdings is expected to generate 1.53 times less return on investment than Nomura Holdings. But when comparing it to its historical volatility, NI Holdings is 1.3 times less risky than Nomura Holdings. It trades about 0.07 of its potential returns per unit of risk. Nomura Holdings ADR is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 415.00 in Nomura Holdings ADR on August 27, 2024 and sell it today you would earn a total of 189.00 from holding Nomura Holdings ADR or generate 45.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NI Holdings vs. Nomura Holdings ADR
Performance |
| Timeline |
| NI Holdings |
| Nomura Holdings ADR |
NI Holdings and Nomura Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NI Holdings and Nomura Holdings
The main advantage of trading using opposite NI Holdings and Nomura Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NI Holdings position performs unexpectedly, Nomura Holdings 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 Nomura Holdings will offset losses from the drop in Nomura Holdings' long position.| NI Holdings vs. Horace Mann Educators | NI Holdings vs. Donegal Group A | NI Holdings vs. Global Indemnity PLC | NI Holdings vs. Selective Insurance Group |
| Nomura Holdings vs. Perella Weinberg Partners | Nomura Holdings vs. Oppenheimer Holdings | Nomura Holdings vs. Stifel Financial Corp | Nomura Holdings vs. Piper Sandler Companies |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |