Correlation Between Nordex SE and Aumann AG
Can any of the company-specific risk be diversified away by investing in both Nordex SE and Aumann AG 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 Nordex SE and Aumann AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordex SE and Aumann AG, you can compare the effects of market volatilities on Nordex SE and Aumann AG 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 Nordex SE with a short position of Aumann AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordex SE and Aumann AG.
Diversification Opportunities for Nordex SE and Aumann AG
Poor diversification
The 3 months correlation between Nordex and Aumann is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Nordex SE and Aumann AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aumann AG and Nordex SE 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 Nordex SE are associated (or correlated) with Aumann AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aumann AG has no effect on the direction of Nordex SE i.e., Nordex SE and Aumann AG go up and down completely randomly.
Pair Corralation between Nordex SE and Aumann AG
If you would invest 1,300 in Aumann AG on August 26, 2024 and sell it today you would earn a total of 0.00 from holding Aumann AG or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordex SE vs. Aumann AG
Performance |
| Timeline |
| Nordex SE |
| Aumann AG |
Nordex SE and Aumann AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordex SE and Aumann AG
The main advantage of trading using opposite Nordex SE and Aumann AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordex SE position performs unexpectedly, Aumann AG 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 Aumann AG will offset losses from the drop in Aumann AG's long position.| Nordex SE vs. Aumann AG | Nordex SE vs. Arista Power | Nordex SE vs. Atlas Copco AB | Nordex SE vs. American Commerce Solutions |
| Aumann AG vs. Alfa Laval AB | Aumann AG vs. Arista Power | Aumann AG vs. Atlas Copco AB | Aumann AG vs. American Commerce Solutions |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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