Correlation Between NTG Nordic and Zimmer Biomet
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and Zimmer Biomet 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 Zimmer Biomet 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 Zimmer Biomet Holdings, you can compare the effects of market volatilities on NTG Nordic and Zimmer Biomet 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 Zimmer Biomet. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and Zimmer Biomet.
Diversification Opportunities for NTG Nordic and Zimmer Biomet
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NTG and Zimmer is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and Zimmer Biomet Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zimmer Biomet Holdings 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 Zimmer Biomet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zimmer Biomet Holdings has no effect on the direction of NTG Nordic i.e., NTG Nordic and Zimmer Biomet go up and down completely randomly.
Pair Corralation between NTG Nordic and Zimmer Biomet
Assuming the 90 days trading horizon NTG Nordic Transport is expected to under-perform the Zimmer Biomet. In addition to that, NTG Nordic is 1.02 times more volatile than Zimmer Biomet Holdings. It trades about -0.24 of its total potential returns per unit of risk. Zimmer Biomet Holdings is currently generating about 0.01 per unit of volatility. If you would invest 10,071 in Zimmer Biomet Holdings on October 9, 2024 and sell it today you would earn a total of 24.00 from holding Zimmer Biomet Holdings or generate 0.24% 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. Zimmer Biomet Holdings
Performance |
| Timeline |
| NTG Nordic Transport |
| Zimmer Biomet Holdings |
NTG Nordic and Zimmer Biomet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and Zimmer Biomet
The main advantage of trading using opposite NTG Nordic and Zimmer Biomet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, Zimmer Biomet 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 Zimmer Biomet will offset losses from the drop in Zimmer Biomet's long position.| NTG Nordic vs. Superior Plus Corp | NTG Nordic vs. NMI Holdings | NTG Nordic vs. SIVERS SEMICONDUCTORS AB | NTG Nordic vs. Talanx AG |
| Zimmer Biomet vs. Boston Scientific | Zimmer Biomet vs. Align Technology | Zimmer Biomet vs. Superior Plus Corp | Zimmer Biomet vs. NMI Holdings |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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