Correlation Between ServiceNow and Nok Airlines
Can any of the company-specific risk be diversified away by investing in both ServiceNow and Nok Airlines 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 ServiceNow and Nok Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ServiceNow and Nok Airlines Public, you can compare the effects of market volatilities on ServiceNow and Nok Airlines 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 ServiceNow with a short position of Nok Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of ServiceNow and Nok Airlines.
Diversification Opportunities for ServiceNow and Nok Airlines
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ServiceNow and Nok is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ServiceNow and Nok Airlines Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nok Airlines Public and ServiceNow 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 ServiceNow are associated (or correlated) with Nok Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nok Airlines Public has no effect on the direction of ServiceNow i.e., ServiceNow and Nok Airlines go up and down completely randomly.
Pair Corralation between ServiceNow and Nok Airlines
If you would invest 38,852 in ServiceNow on August 28, 2024 and sell it today you would earn a total of 66,419 from holding ServiceNow or generate 170.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ServiceNow vs. Nok Airlines Public
Performance |
| Timeline |
| ServiceNow |
| Nok Airlines Public |
ServiceNow and Nok Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ServiceNow and Nok Airlines
The main advantage of trading using opposite ServiceNow and Nok Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ServiceNow position performs unexpectedly, Nok Airlines 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 Nok Airlines will offset losses from the drop in Nok Airlines' long position.| ServiceNow vs. Autodesk | ServiceNow vs. Intuit Inc | ServiceNow vs. Zoom Video Communications | ServiceNow vs. Snowflake |
| Nok Airlines vs. Luxfer Holdings PLC | Nok Airlines vs. X FAB Silicon Foundries | Nok Airlines vs. Air Transport Services | Nok Airlines vs. Ziff Davis |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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