Correlation Between Per Aarsleff and Nilfisk Holding
Can any of the company-specific risk be diversified away by investing in both Per Aarsleff and Nilfisk Holding 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 Per Aarsleff and Nilfisk Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Per Aarsleff Holding and Nilfisk Holding AS, you can compare the effects of market volatilities on Per Aarsleff and Nilfisk Holding 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 Per Aarsleff with a short position of Nilfisk Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Per Aarsleff and Nilfisk Holding.
Diversification Opportunities for Per Aarsleff and Nilfisk Holding
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Per and Nilfisk is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Per Aarsleff Holding and Nilfisk Holding AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nilfisk Holding AS and Per Aarsleff 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 Per Aarsleff Holding are associated (or correlated) with Nilfisk Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nilfisk Holding AS has no effect on the direction of Per Aarsleff i.e., Per Aarsleff and Nilfisk Holding go up and down completely randomly.
Pair Corralation between Per Aarsleff and Nilfisk Holding
Assuming the 90 days trading horizon Per Aarsleff Holding is expected to generate 0.83 times more return on investment than Nilfisk Holding. However, Per Aarsleff Holding is 1.21 times less risky than Nilfisk Holding. It trades about 0.09 of its potential returns per unit of risk. Nilfisk Holding AS is currently generating about -0.02 per unit of risk. If you would invest 22,204 in Per Aarsleff Holding on August 26, 2024 and sell it today you would earn a total of 22,996 from holding Per Aarsleff Holding or generate 103.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Per Aarsleff Holding vs. Nilfisk Holding AS
Performance |
| Timeline |
| Per Aarsleff Holding |
| Nilfisk Holding AS |
Per Aarsleff and Nilfisk Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Per Aarsleff and Nilfisk Holding
The main advantage of trading using opposite Per Aarsleff and Nilfisk Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Per Aarsleff position performs unexpectedly, Nilfisk Holding 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 Nilfisk Holding will offset losses from the drop in Nilfisk Holding's long position.| Per Aarsleff vs. Schouw Co | Per Aarsleff vs. ROCKWOOL International AS | Per Aarsleff vs. Royal Unibrew AS | Per Aarsleff vs. Matas AS |
| Nilfisk Holding vs. North Media AS | Nilfisk Holding vs. HH International AS | Nilfisk Holding vs. Per Aarsleff Holding | Nilfisk Holding vs. First Farms AS |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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