Correlation Between NTG Nordic and Freetrailer Group
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and Freetrailer Group 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 Freetrailer Group 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 Freetrailer Group AS, you can compare the effects of market volatilities on NTG Nordic and Freetrailer Group 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 Freetrailer Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and Freetrailer Group.
Diversification Opportunities for NTG Nordic and Freetrailer Group
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between NTG and Freetrailer is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and Freetrailer Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freetrailer 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 Freetrailer Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freetrailer Group has no effect on the direction of NTG Nordic i.e., NTG Nordic and Freetrailer Group go up and down completely randomly.
Pair Corralation between NTG Nordic and Freetrailer Group
Assuming the 90 days trading horizon NTG Nordic Transport is expected to under-perform the Freetrailer Group. But the stock apears to be less risky and, when comparing its historical volatility, NTG Nordic Transport is 1.07 times less risky than Freetrailer Group. The stock trades about 0.0 of its potential returns per unit of risk. The Freetrailer Group AS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4,350 in Freetrailer Group AS on September 2, 2024 and sell it today you would earn a total of 500.00 from holding Freetrailer Group AS or generate 11.49% 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. Freetrailer Group AS
Performance |
| Timeline |
| NTG Nordic Transport |
| Freetrailer Group |
NTG Nordic and Freetrailer Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and Freetrailer Group
The main advantage of trading using opposite NTG Nordic and Freetrailer Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, Freetrailer Group 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 Freetrailer Group will offset losses from the drop in Freetrailer Group's long position.The idea behind NTG Nordic Transport and Freetrailer Group AS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Freetrailer Group vs. BankIn Bredygt Klimaakt | Freetrailer Group vs. Moens Bank AS | Freetrailer Group vs. Danske Andelskassers Bank | Freetrailer Group vs. Prime Office AS |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |