Correlation Between OMX Stockholm and NCC AB
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By analyzing existing cross correlation between OMX Stockholm Mid and NCC AB, you can compare the effects of market volatilities on OMX Stockholm and NCC AB 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 OMX Stockholm with a short position of NCC AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Stockholm and NCC AB.
Diversification Opportunities for OMX Stockholm and NCC AB
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between OMX and NCC is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding OMX Stockholm Mid and NCC AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NCC AB and OMX Stockholm 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 OMX Stockholm Mid are associated (or correlated) with NCC AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NCC AB has no effect on the direction of OMX Stockholm i.e., OMX Stockholm and NCC AB go up and down completely randomly.
Pair Corralation between OMX Stockholm and NCC AB
Assuming the 90 days trading horizon OMX Stockholm Mid is expected to under-perform the NCC AB. But the index apears to be less risky and, when comparing its historical volatility, OMX Stockholm Mid is 1.43 times less risky than NCC AB. The index trades about -0.07 of its potential returns per unit of risk. The NCC AB is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 15,457 in NCC AB on September 1, 2024 and sell it today you would earn a total of 833.00 from holding NCC AB or generate 5.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OMX Stockholm Mid vs. NCC AB
Performance |
| Timeline |
OMX Stockholm and NCC AB Volatility Contrast
Predicted Return Density |
| Returns |
OMX Stockholm Mid
Pair trading matchups for OMX Stockholm
NCC AB
Pair trading matchups for NCC AB
Pair Trading with OMX Stockholm and NCC AB
The main advantage of trading using opposite OMX Stockholm and NCC AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Stockholm position performs unexpectedly, NCC AB 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 NCC AB will offset losses from the drop in NCC AB's long position.| OMX Stockholm vs. Beowulf Mining PLC | OMX Stockholm vs. Swedbank AB | OMX Stockholm vs. Arion banki hf | OMX Stockholm vs. TradeDoubler 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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