Correlation Between Nokia Oyj and Prologis
Can any of the company-specific risk be diversified away by investing in both Nokia Oyj and Prologis 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 Nokia Oyj and Prologis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nokia Oyj and Prologis, you can compare the effects of market volatilities on Nokia Oyj and Prologis 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 Nokia Oyj with a short position of Prologis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nokia Oyj and Prologis.
Diversification Opportunities for Nokia Oyj and Prologis
Very good diversification
The 3 months correlation between Nokia and Prologis is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Nokia Oyj and Prologis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prologis and Nokia Oyj 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 Nokia Oyj are associated (or correlated) with Prologis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prologis has no effect on the direction of Nokia Oyj i.e., Nokia Oyj and Prologis go up and down completely randomly.
Pair Corralation between Nokia Oyj and Prologis
Assuming the 90 days trading horizon Nokia Oyj is expected to generate 0.71 times more return on investment than Prologis. However, Nokia Oyj is 1.41 times less risky than Prologis. It trades about 0.04 of its potential returns per unit of risk. Prologis is currently generating about 0.0 per unit of risk. If you would invest 2,442 in Nokia Oyj on November 2, 2024 and sell it today you would earn a total of 174.00 from holding Nokia Oyj or generate 7.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.03% |
| Values | Daily Returns |
Nokia Oyj vs. Prologis
Performance |
| Timeline |
| Nokia Oyj |
| Prologis |
Nokia Oyj and Prologis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nokia Oyj and Prologis
The main advantage of trading using opposite Nokia Oyj and Prologis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nokia Oyj position performs unexpectedly, Prologis 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 Prologis will offset losses from the drop in Prologis' long position.| Nokia Oyj vs. Liberty Broadband | Nokia Oyj vs. ON Semiconductor | Nokia Oyj vs. JB Hunt Transport | Nokia Oyj vs. Chunghwa Telecom Co, |
| Prologis vs. Bank of America | Prologis vs. Broadridge Financial Solutions, | Prologis vs. Ameriprise Financial | Prologis vs. Eastman Chemical |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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