Correlation Between NTG Nordic and Apple
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and Apple 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 Apple 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 Apple Inc, you can compare the effects of market volatilities on NTG Nordic and Apple 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 Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and Apple.
Diversification Opportunities for NTG Nordic and Apple
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NTG and Apple is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc 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 Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of NTG Nordic i.e., NTG Nordic and Apple go up and down completely randomly.
Pair Corralation between NTG Nordic and Apple
Assuming the 90 days trading horizon NTG Nordic is expected to generate 1.1 times less return on investment than Apple. In addition to that, NTG Nordic is 1.68 times more volatile than Apple Inc. It trades about 0.05 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.1 per unit of volatility. If you would invest 20,705 in Apple Inc on September 2, 2024 and sell it today you would earn a total of 1,705 from holding Apple Inc or generate 8.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NTG Nordic Transport vs. Apple Inc
Performance |
| Timeline |
| NTG Nordic Transport |
| Apple Inc |
NTG Nordic and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and Apple
The main advantage of trading using opposite NTG Nordic and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple'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 |
| Apple vs. United Airlines Holdings | Apple vs. URBAN OUTFITTERS | Apple vs. Aegean Airlines SA | Apple vs. American Eagle Outfitters |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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