Correlation Between NTG Nordic and Everest
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and Everest 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 Everest 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 Everest Group, you can compare the effects of market volatilities on NTG Nordic and Everest 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 Everest. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and Everest.
Diversification Opportunities for NTG Nordic and Everest
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NTG and Everest is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and Everest Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everest Group 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 Everest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everest Group has no effect on the direction of NTG Nordic i.e., NTG Nordic and Everest go up and down completely randomly.
Pair Corralation between NTG Nordic and Everest
Assuming the 90 days trading horizon NTG Nordic Transport is expected to under-perform the Everest. But the stock apears to be less risky and, when comparing its historical volatility, NTG Nordic Transport is 1.02 times less risky than Everest. The stock trades about -0.3 of its potential returns per unit of risk. The Everest Group is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 34,552 in Everest Group on October 11, 2024 and sell it today you would lose (22.00) from holding Everest Group or give up 0.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NTG Nordic Transport vs. Everest Group
Performance |
| Timeline |
| NTG Nordic Transport |
| Everest Group |
NTG Nordic and Everest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and Everest
The main advantage of trading using opposite NTG Nordic and Everest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, Everest 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 Everest will offset losses from the drop in Everest's long position.| NTG Nordic vs. The Hongkong and | NTG Nordic vs. Pebblebrook Hotel Trust | NTG Nordic vs. Choice Hotels International | NTG Nordic vs. MHP Hotel AG |
| Everest vs. ARDAGH METAL PACDL 0001 | Everest vs. GRIFFIN MINING LTD | Everest vs. NTG Nordic Transport | Everest vs. ANTA SPORTS PRODUCT |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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