Correlation Between Nordic Unmanned and Bewi Asa
Can any of the company-specific risk be diversified away by investing in both Nordic Unmanned and Bewi Asa 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 Unmanned and Bewi Asa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Unmanned As and Bewi Asa, you can compare the effects of market volatilities on Nordic Unmanned and Bewi Asa 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 Unmanned with a short position of Bewi Asa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Unmanned and Bewi Asa.
Diversification Opportunities for Nordic Unmanned and Bewi Asa
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nordic and Bewi is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Unmanned As and Bewi Asa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bewi Asa and Nordic Unmanned 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 Unmanned As are associated (or correlated) with Bewi Asa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bewi Asa has no effect on the direction of Nordic Unmanned i.e., Nordic Unmanned and Bewi Asa go up and down completely randomly.
Pair Corralation between Nordic Unmanned and Bewi Asa
Assuming the 90 days trading horizon Nordic Unmanned As is expected to under-perform the Bewi Asa. In addition to that, Nordic Unmanned is 5.55 times more volatile than Bewi Asa. It trades about -0.02 of its total potential returns per unit of risk. Bewi Asa is currently generating about -0.09 per unit of volatility. If you would invest 2,520 in Bewi Asa on September 3, 2024 and sell it today you would lose (200.00) from holding Bewi Asa or give up 7.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Unmanned As vs. Bewi Asa
Performance |
| Timeline |
| Nordic Unmanned As |
| Bewi Asa |
Nordic Unmanned and Bewi Asa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Unmanned and Bewi Asa
The main advantage of trading using opposite Nordic Unmanned and Bewi Asa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Unmanned position performs unexpectedly, Bewi Asa 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 Bewi Asa will offset losses from the drop in Bewi Asa's long position.| Nordic Unmanned vs. Kongsberg Gruppen ASA | Nordic Unmanned vs. Elkem ASA | Nordic Unmanned vs. Integrated Wind Solutions | Nordic Unmanned vs. Vow ASA |
| Bewi Asa vs. Kitron ASA | Bewi Asa vs. Norske Skog Asa | Bewi Asa vs. AF Gruppen ASA | Bewi Asa vs. Elkem ASA |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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