Correlation Between NYSE Composite and NORSK
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By analyzing existing cross correlation between NYSE Composite and NORSK HYDRO A, you can compare the effects of market volatilities on NYSE Composite and NORSK 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 NYSE Composite with a short position of NORSK. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and NORSK.
Diversification Opportunities for NYSE Composite and NORSK
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NYSE and NORSK is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and NORSK HYDRO A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORSK HYDRO A and NYSE Composite 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 NYSE Composite are associated (or correlated) with NORSK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORSK HYDRO A has no effect on the direction of NYSE Composite i.e., NYSE Composite and NORSK go up and down completely randomly.
Pair Corralation between NYSE Composite and NORSK
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.95 times more return on investment than NORSK. However, NYSE Composite is 1.95 times more volatile than NORSK HYDRO A. It trades about 0.19 of its potential returns per unit of risk. NORSK HYDRO A is currently generating about 0.06 per unit of risk. If you would invest 1,956,073 in NYSE Composite on August 25, 2024 and sell it today you would earn a total of 56,272 from holding NYSE Composite or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
NYSE Composite vs. NORSK HYDRO A
Performance |
| Timeline |
NYSE Composite and NORSK Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
NORSK HYDRO A
Pair trading matchups for NORSK
Pair Trading with NYSE Composite and NORSK
The main advantage of trading using opposite NYSE Composite and NORSK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, NORSK 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 NORSK will offset losses from the drop in NORSK's long position.| NYSE Composite vs. Awilco Drilling PLC | NYSE Composite vs. AKITA Drilling | NYSE Composite vs. SunOpta | NYSE Composite vs. Delek Drilling |
| NORSK vs. AEP TEX INC | NORSK vs. US BANK NATIONAL | NORSK vs. Dupont De Nemours | NORSK vs. The Travelers Companies |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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