Correlation Between NRC Group and Crayon Group
Can any of the company-specific risk be diversified away by investing in both NRC Group and Crayon Group 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 NRC Group and Crayon Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NRC Group ASA and Crayon Group Holding, you can compare the effects of market volatilities on NRC Group and Crayon Group 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 NRC Group with a short position of Crayon Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of NRC Group and Crayon Group.
Diversification Opportunities for NRC Group and Crayon Group
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between NRC and Crayon is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding NRC Group ASA and Crayon Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crayon Group Holding and NRC Group 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 NRC Group ASA are associated (or correlated) with Crayon Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crayon Group Holding has no effect on the direction of NRC Group i.e., NRC Group and Crayon Group go up and down completely randomly.
Pair Corralation between NRC Group and Crayon Group
Assuming the 90 days trading horizon NRC Group ASA is expected to generate 1.32 times more return on investment than Crayon Group. However, NRC Group is 1.32 times more volatile than Crayon Group Holding. It trades about 0.33 of its potential returns per unit of risk. Crayon Group Holding is currently generating about 0.11 per unit of risk. If you would invest 341.00 in NRC Group ASA on August 30, 2024 and sell it today you would earn a total of 109.00 from holding NRC Group ASA or generate 31.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NRC Group ASA vs. Crayon Group Holding
Performance |
| Timeline |
| NRC Group ASA |
| Crayon Group Holding |
NRC Group and Crayon Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NRC Group and Crayon Group
The main advantage of trading using opposite NRC Group and Crayon Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NRC Group position performs unexpectedly, Crayon Group 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 Crayon Group will offset losses from the drop in Crayon Group's long position.The idea behind NRC Group ASA and Crayon Group Holding pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Crayon Group vs. Zaptec AS | Crayon Group vs. Nordic Semiconductor ASA | Crayon Group vs. Scatec Solar OL | Crayon Group vs. Kitron 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |