Correlation Between Novo Nordisk and LUXOR-B
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By analyzing existing cross correlation between Novo Nordisk AS and Investeringsselskabet Luxor AS, you can compare the effects of market volatilities on Novo Nordisk and LUXOR-B 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 Novo Nordisk with a short position of LUXOR-B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Novo Nordisk and LUXOR-B.
Diversification Opportunities for Novo Nordisk and LUXOR-B
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Novo and LUXOR-B is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Novo Nordisk AS and Investeringsselskabet Luxor AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investeringsselskabet and Novo Nordisk 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 Novo Nordisk AS are associated (or correlated) with LUXOR-B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investeringsselskabet has no effect on the direction of Novo Nordisk i.e., Novo Nordisk and LUXOR-B go up and down completely randomly.
Pair Corralation between Novo Nordisk and LUXOR-B
Assuming the 90 days trading horizon Novo Nordisk AS is expected to under-perform the LUXOR-B. In addition to that, Novo Nordisk is 1.53 times more volatile than Investeringsselskabet Luxor AS. It trades about -0.11 of its total potential returns per unit of risk. Investeringsselskabet Luxor AS is currently generating about 0.17 per unit of volatility. If you would invest 58,000 in Investeringsselskabet Luxor AS on October 26, 2024 and sell it today you would earn a total of 14,500 from holding Investeringsselskabet Luxor AS or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Novo Nordisk AS vs. Investeringsselskabet Luxor AS
Performance |
| Timeline |
| Novo Nordisk AS |
| Investeringsselskabet |
Novo Nordisk and LUXOR-B Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Novo Nordisk and LUXOR-B
The main advantage of trading using opposite Novo Nordisk and LUXOR-B positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Novo Nordisk position performs unexpectedly, LUXOR-B 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 LUXOR-B will offset losses from the drop in LUXOR-B's long position.| Novo Nordisk vs. Vestas Wind Systems | Novo Nordisk vs. Danske Bank AS | Novo Nordisk vs. Bavarian Nordic | Novo Nordisk vs. DSV Panalpina AS |
| LUXOR-B vs. Skjern Bank AS | LUXOR-B vs. Groenlandsbanken AS | LUXOR-B vs. Fynske Bank AS | LUXOR-B vs. Lollands Bank |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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