Correlation Between NTG Nordic and RIAS AS
Can any of the company-specific risk be diversified away by investing in both NTG Nordic and RIAS AS 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 RIAS AS 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 RIAS AS, you can compare the effects of market volatilities on NTG Nordic and RIAS AS 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 RIAS AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of NTG Nordic and RIAS AS.
Diversification Opportunities for NTG Nordic and RIAS AS
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NTG and RIAS is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding NTG Nordic Transport and RIAS AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RIAS 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 RIAS AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RIAS AS has no effect on the direction of NTG Nordic i.e., NTG Nordic and RIAS AS go up and down completely randomly.
Pair Corralation between NTG Nordic and RIAS AS
Assuming the 90 days trading horizon NTG Nordic Transport is expected to under-perform the RIAS AS. In addition to that, NTG Nordic is 1.02 times more volatile than RIAS AS. It trades about -0.4 of its total potential returns per unit of risk. RIAS AS is currently generating about 0.15 per unit of volatility. If you would invest 65,000 in RIAS AS on October 22, 2024 and sell it today you would earn a total of 2,500 from holding RIAS AS or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 94.12% |
| Values | Daily Returns |
NTG Nordic Transport vs. RIAS AS
Performance |
| Timeline |
| NTG Nordic Transport |
| RIAS AS |
NTG Nordic and RIAS AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NTG Nordic and RIAS AS
The main advantage of trading using opposite NTG Nordic and RIAS AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NTG Nordic position performs unexpectedly, RIAS AS 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 RIAS AS will offset losses from the drop in RIAS AS's long position.| NTG Nordic vs. cBrain AS | NTG Nordic vs. ChemoMetec AS | NTG Nordic vs. NKT AS | NTG Nordic vs. DSV Panalpina 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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