Correlation Between Nordic Waterproofing and Netel Holding
Can any of the company-specific risk be diversified away by investing in both Nordic Waterproofing and Netel 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 Waterproofing and Netel Holding 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 Netel Holding AB, you can compare the effects of market volatilities on Nordic Waterproofing and Netel 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 Waterproofing with a short position of Netel Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Waterproofing and Netel Holding.
Diversification Opportunities for Nordic Waterproofing and Netel Holding
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordic and Netel is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Waterproofing Holding and Netel Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netel Holding 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 Netel Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netel Holding AB has no effect on the direction of Nordic Waterproofing i.e., Nordic Waterproofing and Netel Holding go up and down completely randomly.
Pair Corralation between Nordic Waterproofing and Netel Holding
Assuming the 90 days trading horizon Nordic Waterproofing Holding is expected to generate 0.37 times more return on investment than Netel Holding. However, Nordic Waterproofing Holding is 2.67 times less risky than Netel Holding. It trades about 0.05 of its potential returns per unit of risk. Netel Holding AB is currently generating about -0.03 per unit of risk. If you would invest 13,559 in Nordic Waterproofing Holding on January 17, 2025 and sell it today you would earn a total of 4,681 from holding Nordic Waterproofing Holding or generate 34.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.57% |
| Values | Daily Returns |
Nordic Waterproofing Holding vs. Netel Holding AB
Performance |
| Timeline |
| Nordic Waterproofing |
Risk-Adjusted Performance
Modest
Weak | Strong |
| Netel Holding AB |
Nordic Waterproofing and Netel Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Waterproofing and Netel Holding
The main advantage of trading using opposite Nordic Waterproofing and Netel Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Waterproofing position performs unexpectedly, Netel 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 Netel Holding will offset losses from the drop in Netel Holding's long position.| Nordic Waterproofing vs. Bufab Holding AB | Nordic Waterproofing vs. Garo AB | Nordic Waterproofing vs. Inwido AB | Nordic Waterproofing vs. CTT Systems AB |
| Netel Holding vs. NCAB Group | Netel Holding vs. Nordisk Bergteknik AB | Netel Holding vs. Ctek AB | Netel Holding vs. Norva24 Group 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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