Correlation Between Nordic Waterproofing and Viva Wine
Can any of the company-specific risk be diversified away by investing in both Nordic Waterproofing and Viva Wine 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 Viva Wine 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 Viva Wine Group, you can compare the effects of market volatilities on Nordic Waterproofing and Viva Wine 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 Viva Wine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Waterproofing and Viva Wine.
Diversification Opportunities for Nordic Waterproofing and Viva Wine
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordic and Viva is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Waterproofing Holding and Viva Wine Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viva Wine Group 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 Viva Wine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viva Wine Group has no effect on the direction of Nordic Waterproofing i.e., Nordic Waterproofing and Viva Wine go up and down completely randomly.
Pair Corralation between Nordic Waterproofing and Viva Wine
Assuming the 90 days trading horizon Nordic Waterproofing Holding is expected to generate 1.31 times more return on investment than Viva Wine. However, Nordic Waterproofing is 1.31 times more volatile than Viva Wine Group. It trades about 0.04 of its potential returns per unit of risk. Viva Wine Group is currently generating about -0.16 per unit of risk. If you would invest 16,720 in Nordic Waterproofing Holding on August 30, 2024 and sell it today you would earn a total of 520.00 from holding Nordic Waterproofing Holding or generate 3.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Waterproofing Holding vs. Viva Wine Group
Performance |
| Timeline |
| Nordic Waterproofing |
| Viva Wine Group |
Nordic Waterproofing and Viva Wine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Waterproofing and Viva Wine
The main advantage of trading using opposite Nordic Waterproofing and Viva Wine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Waterproofing position performs unexpectedly, Viva Wine 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 Viva Wine will offset losses from the drop in Viva Wine'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 |
| Viva Wine vs. Cint Group AB | Viva Wine vs. Nordic Waterproofing Holding | Viva Wine vs. RVRC Holding AB | Viva Wine vs. Inwido 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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