Correlation Between Nordic Waterproofing and Balco Group
Can any of the company-specific risk be diversified away by investing in both Nordic Waterproofing and Balco 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 Nordic Waterproofing and Balco Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Waterproofing Holding and Balco Group AB, you can compare the effects of market volatilities on Nordic Waterproofing and Balco 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 Nordic Waterproofing with a short position of Balco Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Waterproofing and Balco Group.
Diversification Opportunities for Nordic Waterproofing and Balco Group
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nordic and Balco is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Waterproofing Holding and Balco Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Balco Group AB and Nordic Waterproofing 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 Waterproofing Holding are associated (or correlated) with Balco Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Balco Group AB has no effect on the direction of Nordic Waterproofing i.e., Nordic Waterproofing and Balco Group go up and down completely randomly.
Pair Corralation between Nordic Waterproofing and Balco Group
Assuming the 90 days trading horizon Nordic Waterproofing Holding is expected to generate 0.82 times more return on investment than Balco Group. However, Nordic Waterproofing Holding is 1.22 times less risky than Balco Group. It trades about 0.01 of its potential returns per unit of risk. Balco Group AB is currently generating about -0.08 per unit of risk. If you would invest 16,200 in Nordic Waterproofing Holding on September 3, 2024 and sell it today you would earn a total of 160.00 from holding Nordic Waterproofing Holding or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Waterproofing Holding vs. Balco Group AB
Performance |
| Timeline |
| Nordic Waterproofing |
| Balco Group AB |
Nordic Waterproofing and Balco Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Waterproofing and Balco Group
The main advantage of trading using opposite Nordic Waterproofing and Balco Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Waterproofing position performs unexpectedly, Balco 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 Balco Group will offset losses from the drop in Balco Group's long position.| Nordic Waterproofing vs. Inwido AB | Nordic Waterproofing vs. Byggmax Group AB | Nordic Waterproofing vs. AQ Group AB | Nordic Waterproofing vs. Garo AB |
| Balco Group vs. Inwido AB | Balco Group vs. Nordic Waterproofing Holding | Balco Group vs. Alimak Hek Group | Balco Group vs. Ferronordic AB |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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