Correlation Between Nok Airlines and Summit Materials
Can any of the company-specific risk be diversified away by investing in both Nok Airlines and Summit Materials 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 Nok Airlines and Summit Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nok Airlines Public and Summit Materials, you can compare the effects of market volatilities on Nok Airlines and Summit Materials 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 Nok Airlines with a short position of Summit Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nok Airlines and Summit Materials.
Diversification Opportunities for Nok Airlines and Summit Materials
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nok and Summit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nok Airlines Public and Summit Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Materials and Nok Airlines 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 Nok Airlines Public are associated (or correlated) with Summit Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Materials has no effect on the direction of Nok Airlines i.e., Nok Airlines and Summit Materials go up and down completely randomly.
Pair Corralation between Nok Airlines and Summit Materials
If you would invest 4,563 in Summit Materials on August 28, 2024 and sell it today you would earn a total of 512.00 from holding Summit Materials or generate 11.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Nok Airlines Public vs. Summit Materials
Performance |
| Timeline |
| Nok Airlines Public |
| Summit Materials |
Nok Airlines and Summit Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nok Airlines and Summit Materials
The main advantage of trading using opposite Nok Airlines and Summit Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nok Airlines position performs unexpectedly, Summit Materials 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 Summit Materials will offset losses from the drop in Summit Materials' long position.| Nok Airlines vs. Westrock Coffee | Nok Airlines vs. Boston Beer | Nok Airlines vs. Amgen Inc | Nok Airlines vs. Ambev SA ADR |
| Summit Materials vs. Holcim | Summit Materials vs. Lafargeholcim Ltd ADR | Summit Materials vs. The Monarch Cement |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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