Correlation Between Nordic Technology and Tekna Holding
Can any of the company-specific risk be diversified away by investing in both Nordic Technology and Tekna Holding 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 Nordic Technology and Tekna Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Technology Group and Tekna Holding AS, you can compare the effects of market volatilities on Nordic Technology and Tekna Holding 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 Nordic Technology with a short position of Tekna Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Technology and Tekna Holding.
Diversification Opportunities for Nordic Technology and Tekna Holding
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nordic and Tekna is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Technology Group and Tekna Holding AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tekna Holding AS and Nordic Technology 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 Nordic Technology Group are associated (or correlated) with Tekna Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tekna Holding AS has no effect on the direction of Nordic Technology i.e., Nordic Technology and Tekna Holding go up and down completely randomly.
Pair Corralation between Nordic Technology and Tekna Holding
Assuming the 90 days trading horizon Nordic Technology Group is expected to under-perform the Tekna Holding. In addition to that, Nordic Technology is 1.35 times more volatile than Tekna Holding AS. It trades about -0.02 of its total potential returns per unit of risk. Tekna Holding AS is currently generating about 0.0 per unit of volatility. If you would invest 602.00 in Tekna Holding AS on September 14, 2024 and sell it today you would lose (219.00) from holding Tekna Holding AS or give up 36.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Nordic Technology Group vs. Tekna Holding AS
Performance |
| Timeline |
| Nordic Technology |
| Tekna Holding AS |
Nordic Technology and Tekna Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Technology and Tekna Holding
The main advantage of trading using opposite Nordic Technology and Tekna Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Technology position performs unexpectedly, Tekna Holding 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 Tekna Holding will offset losses from the drop in Tekna Holding's long position.| Nordic Technology vs. Next Biometrics Group | Nordic Technology vs. Kongsberg Gruppen ASA | Nordic Technology vs. Napatech AS | Nordic Technology vs. Elkem ASA |
| Tekna Holding vs. Vow Green Metals | Tekna Holding vs. Nordic Technology Group | Tekna Holding vs. Aasen Sparebank | Tekna Holding vs. Waste Plastic Upcycling |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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