Correlation Between NTG Nordic and SWISS WATER
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and SWISS WATER 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 NTG Nordic and SWISS WATER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NTG Nordic Transport and SWISS WATER DECAFFCOFFEE, you can compare the effects of market volatilities on NTG Nordic and SWISS WATER 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 NTG Nordic with a short position of SWISS WATER. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and SWISS WATER.
Diversification Opportunities for NTG Nordic and SWISS WATER
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between NTG and SWISS is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and SWISS WATER DECAFFCOFFEE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SWISS WATER DECAFFCOFFEE and NTG Nordic 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 NTG Nordic Transport are associated (or correlated) with SWISS WATER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SWISS WATER DECAFFCOFFEE has no effect on the direction of NTG Nordic i.e., NTG Nordic and SWISS WATER go up and down completely randomly.
Pair Corralation between NTG Nordic and SWISS WATER
Assuming the 90 days trading horizon NTG Nordic is expected to generate 13.31 times less return on investment than SWISS WATER. But when comparing it to its historical volatility, NTG Nordic Transport is 1.6 times less risky than SWISS WATER. It trades about 0.02 of its potential returns per unit of risk. SWISS WATER DECAFFCOFFEE is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 252.00 in SWISS WATER DECAFFCOFFEE on August 31, 2024 and sell it today you would earn a total of 16.00 from holding SWISS WATER DECAFFCOFFEE or generate 6.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NTG Nordic Transport vs. SWISS WATER DECAFFCOFFEE
Performance |
| Timeline |
| NTG Nordic Transport |
| SWISS WATER DECAFFCOFFEE |
NTG Nordic and SWISS WATER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and SWISS WATER
The main advantage of trading using opposite NTG Nordic and SWISS WATER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, SWISS WATER 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 SWISS WATER will offset losses from the drop in SWISS WATER's long position.| NTG Nordic vs. Superior Plus Corp | NTG Nordic vs. NMI Holdings | NTG Nordic vs. Origin Agritech | NTG Nordic vs. SIVERS SEMICONDUCTORS AB |
| SWISS WATER vs. Pure Storage | SWISS WATER vs. DICKER DATA LTD | SWISS WATER vs. DATANG INTL POW | SWISS WATER vs. Public Storage |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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