Correlation Between Nykode Therapeutics and Equinor ASA
Can any of the company-specific risk be diversified away by investing in both Nykode Therapeutics and Equinor 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 Nykode Therapeutics and Equinor ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nykode Therapeutics ASA and Equinor ASA, you can compare the effects of market volatilities on Nykode Therapeutics and Equinor 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 Nykode Therapeutics with a short position of Equinor ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nykode Therapeutics and Equinor ASA.
Diversification Opportunities for Nykode Therapeutics and Equinor ASA
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nykode and Equinor is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Nykode Therapeutics ASA and Equinor ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equinor ASA and Nykode Therapeutics 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 Nykode Therapeutics ASA are associated (or correlated) with Equinor ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equinor ASA has no effect on the direction of Nykode Therapeutics i.e., Nykode Therapeutics and Equinor ASA go up and down completely randomly.
Pair Corralation between Nykode Therapeutics and Equinor ASA
Assuming the 90 days trading horizon Nykode Therapeutics ASA is expected to under-perform the Equinor ASA. In addition to that, Nykode Therapeutics is 2.77 times more volatile than Equinor ASA. It trades about -0.08 of its total potential returns per unit of risk. Equinor ASA is currently generating about 0.01 per unit of volatility. If you would invest 25,737 in Equinor ASA on September 3, 2024 and sell it today you would earn a total of 983.00 from holding Equinor ASA or generate 3.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nykode Therapeutics ASA vs. Equinor ASA
Performance |
| Timeline |
| Nykode Therapeutics ASA |
| Equinor ASA |
Nykode Therapeutics and Equinor ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nykode Therapeutics and Equinor ASA
The main advantage of trading using opposite Nykode Therapeutics and Equinor ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nykode Therapeutics position performs unexpectedly, Equinor 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 Equinor ASA will offset losses from the drop in Equinor ASA's long position.| Nykode Therapeutics vs. Equinor ASA | Nykode Therapeutics vs. DnB ASA | Nykode Therapeutics vs. Aker BP ASA | Nykode Therapeutics vs. Telenor ASA |
| Equinor ASA vs. DnB ASA | Equinor ASA vs. Mowi ASA | Equinor ASA vs. Yara International ASA | Equinor ASA vs. Telenor 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| CEOs Directory Screen CEOs from public companies around the world | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |