Correlation Between NTG Nordic and Cessatech
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and Cessatech 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 Cessatech 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 Cessatech AS, you can compare the effects of market volatilities on NTG Nordic and Cessatech 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 Cessatech. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and Cessatech.
Diversification Opportunities for NTG Nordic and Cessatech
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NTG and Cessatech is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and Cessatech AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cessatech AS 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 Cessatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cessatech AS has no effect on the direction of NTG Nordic i.e., NTG Nordic and Cessatech go up and down completely randomly.
Pair Corralation between NTG Nordic and Cessatech
Assuming the 90 days trading horizon NTG Nordic Transport is expected to generate 0.55 times more return on investment than Cessatech. However, NTG Nordic Transport is 1.81 times less risky than Cessatech. It trades about -0.04 of its potential returns per unit of risk. Cessatech AS is currently generating about -0.04 per unit of risk. If you would invest 44,450 in NTG Nordic Transport on September 1, 2024 and sell it today you would lose (15,950) from holding NTG Nordic Transport or give up 35.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.59% |
| Values | Daily Returns |
NTG Nordic Transport vs. Cessatech AS
Performance |
| Timeline |
| NTG Nordic Transport |
| Cessatech AS |
NTG Nordic and Cessatech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and Cessatech
The main advantage of trading using opposite NTG Nordic and Cessatech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, Cessatech 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 Cessatech will offset losses from the drop in Cessatech's long position.| NTG Nordic vs. cBrain AS | NTG Nordic vs. Netcompany Group AS | NTG Nordic vs. ChemoMetec AS | NTG Nordic vs. NKT AS |
| Cessatech vs. Novo Nordisk AS | Cessatech vs. Nordea Bank Abp | Cessatech vs. DSV Panalpina AS | Cessatech vs. AP Mller |
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 CEOs Directory module to screen CEOs from public companies around the world.
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