Correlation Between Nordic Mining and Beerenberg
Can any of the company-specific risk be diversified away by investing in both Nordic Mining and Beerenberg 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 Nordic Mining and Beerenberg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Mining ASA and Beerenberg AS, you can compare the effects of market volatilities on Nordic Mining and Beerenberg 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 Nordic Mining with a short position of Beerenberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Mining and Beerenberg.
Diversification Opportunities for Nordic Mining and Beerenberg
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordic and Beerenberg is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Mining ASA and Beerenberg AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beerenberg AS and Nordic Mining 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 Nordic Mining ASA are associated (or correlated) with Beerenberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beerenberg AS has no effect on the direction of Nordic Mining i.e., Nordic Mining and Beerenberg go up and down completely randomly.
Pair Corralation between Nordic Mining and Beerenberg
Assuming the 90 days trading horizon Nordic Mining ASA is expected to under-perform the Beerenberg. In addition to that, Nordic Mining is 3.54 times more volatile than Beerenberg AS. It trades about -0.03 of its total potential returns per unit of risk. Beerenberg AS is currently generating about 0.0 per unit of volatility. If you would invest 4,100 in Beerenberg AS on August 25, 2024 and sell it today you would earn a total of 0.00 from holding Beerenberg AS or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Nordic Mining ASA vs. Beerenberg AS
Performance |
| Timeline |
| Nordic Mining ASA |
| Beerenberg AS |
Nordic Mining and Beerenberg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Mining and Beerenberg
The main advantage of trading using opposite Nordic Mining and Beerenberg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Mining position performs unexpectedly, Beerenberg 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 Beerenberg will offset losses from the drop in Beerenberg's long position.| Nordic Mining vs. Elkem ASA | Nordic Mining vs. Vow ASA | Nordic Mining vs. North Energy ASA | Nordic Mining vs. Arcticzymes Technologies ASA |
| Beerenberg vs. Equinor ASA | Beerenberg vs. DnB ASA | Beerenberg vs. Aker BP ASA | Beerenberg vs. Telenor ASA |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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