Correlation Between FLOW TRADERS and NTG Nordic
Can any of the company-specific risk be diversified away by investing in both FLOW TRADERS and NTG Nordic 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 FLOW TRADERS and NTG Nordic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FLOW TRADERS LTD and NTG Nordic Transport, you can compare the effects of market volatilities on FLOW TRADERS and NTG Nordic 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 FLOW TRADERS with a short position of NTG Nordic. Check out your portfolio center. Please also check ongoing floating volatility patterns of FLOW TRADERS and NTG Nordic.
Diversification Opportunities for FLOW TRADERS and NTG Nordic
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FLOW and NTG is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding FLOW TRADERS LTD and NTG Nordic Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NTG Nordic Transport and FLOW TRADERS 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 FLOW TRADERS LTD are associated (or correlated) with NTG Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NTG Nordic Transport has no effect on the direction of FLOW TRADERS i.e., FLOW TRADERS and NTG Nordic go up and down completely randomly.
Pair Corralation between FLOW TRADERS and NTG Nordic
Assuming the 90 days horizon FLOW TRADERS LTD is expected to generate 0.53 times more return on investment than NTG Nordic. However, FLOW TRADERS LTD is 1.88 times less risky than NTG Nordic. It trades about 0.22 of its potential returns per unit of risk. NTG Nordic Transport is currently generating about 0.05 per unit of risk. If you would invest 1,685 in FLOW TRADERS LTD on September 5, 2024 and sell it today you would earn a total of 431.00 from holding FLOW TRADERS LTD or generate 25.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FLOW TRADERS LTD vs. NTG Nordic Transport
Performance |
| Timeline |
| FLOW TRADERS LTD |
| NTG Nordic Transport |
FLOW TRADERS and NTG Nordic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FLOW TRADERS and NTG Nordic
The main advantage of trading using opposite FLOW TRADERS and NTG Nordic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FLOW TRADERS position performs unexpectedly, NTG Nordic 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 NTG Nordic will offset losses from the drop in NTG Nordic's long position.| FLOW TRADERS vs. Tyson Foods | FLOW TRADERS vs. AGRICULTBK HADR25 YC | FLOW TRADERS vs. Penta Ocean Construction Co | FLOW TRADERS vs. Hanison Construction Holdings |
| NTG Nordic vs. Addus HomeCare | NTG Nordic vs. Canon Marketing Japan | NTG Nordic vs. FLOW TRADERS LTD | NTG Nordic vs. Auto Trader Group |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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