Correlation Between Nissan Chemical and Bilfinger
Can any of the company-specific risk be diversified away by investing in both Nissan Chemical and Bilfinger 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 Nissan Chemical and Bilfinger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nissan Chemical Corp and Bilfinger SE, you can compare the effects of market volatilities on Nissan Chemical and Bilfinger 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 Nissan Chemical with a short position of Bilfinger. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nissan Chemical and Bilfinger.
Diversification Opportunities for Nissan Chemical and Bilfinger
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nissan and Bilfinger is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Nissan Chemical Corp and Bilfinger SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilfinger SE and Nissan Chemical 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 Nissan Chemical Corp are associated (or correlated) with Bilfinger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilfinger SE has no effect on the direction of Nissan Chemical i.e., Nissan Chemical and Bilfinger go up and down completely randomly.
Pair Corralation between Nissan Chemical and Bilfinger
Assuming the 90 days trading horizon Nissan Chemical Corp is expected to under-perform the Bilfinger. In addition to that, Nissan Chemical is 1.08 times more volatile than Bilfinger SE. It trades about -0.02 of its total potential returns per unit of risk. Bilfinger SE is currently generating about 0.08 per unit of volatility. If you would invest 2,524 in Bilfinger SE on September 14, 2024 and sell it today you would earn a total of 2,181 from holding Bilfinger SE or generate 86.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Nissan Chemical Corp vs. Bilfinger SE
Performance |
| Timeline |
| Nissan Chemical Corp |
| Bilfinger SE |
Nissan Chemical and Bilfinger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nissan Chemical and Bilfinger
The main advantage of trading using opposite Nissan Chemical and Bilfinger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nissan Chemical position performs unexpectedly, Bilfinger 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 Bilfinger will offset losses from the drop in Bilfinger's long position.| Nissan Chemical vs. Apple Inc | Nissan Chemical vs. Apple Inc | Nissan Chemical vs. Apple Inc | Nissan Chemical vs. Apple Inc |
| Bilfinger vs. Calibre Mining Corp | Bilfinger vs. Nissan Chemical Corp | Bilfinger vs. KINGBOARD CHEMICAL | Bilfinger vs. Sanyo Chemical Industries |
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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