Correlation Between NTG Nordic and QBE Insurance
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and QBE Insurance 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 QBE Insurance 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 QBE Insurance Group, you can compare the effects of market volatilities on NTG Nordic and QBE Insurance 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 QBE Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and QBE Insurance.
Diversification Opportunities for NTG Nordic and QBE Insurance
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NTG and QBE is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and QBE Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QBE Insurance 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 QBE Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QBE Insurance Group has no effect on the direction of NTG Nordic i.e., NTG Nordic and QBE Insurance go up and down completely randomly.
Pair Corralation between NTG Nordic and QBE Insurance
Assuming the 90 days trading horizon NTG Nordic is expected to generate 3.58 times less return on investment than QBE Insurance. In addition to that, NTG Nordic is 1.69 times more volatile than QBE Insurance Group. It trades about 0.01 of its total potential returns per unit of risk. QBE Insurance Group is currently generating about 0.06 per unit of volatility. If you would invest 762.00 in QBE Insurance Group on October 14, 2024 and sell it today you would earn a total of 408.00 from holding QBE Insurance Group or generate 53.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NTG Nordic Transport vs. QBE Insurance Group
Performance |
| Timeline |
| NTG Nordic Transport |
| QBE Insurance Group |
NTG Nordic and QBE Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and QBE Insurance
The main advantage of trading using opposite NTG Nordic and QBE Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, QBE Insurance 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 QBE Insurance will offset losses from the drop in QBE Insurance's long position.| NTG Nordic vs. ecotel communication ag | NTG Nordic vs. GREENX METALS LTD | NTG Nordic vs. Forsys Metals Corp | NTG Nordic vs. Zijin Mining Group |
| QBE Insurance vs. Fukuyama Transporting Co | QBE Insurance vs. Cal Maine Foods | QBE Insurance vs. NTG Nordic Transport | QBE Insurance vs. SOEDER SPORTFISKE AB |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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