Correlation Between SIEMENS AG and NEL ASA
Can any of the company-specific risk be diversified away by investing in both SIEMENS AG and NEL 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 SIEMENS AG and NEL ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIEMENS AG SP and NEL ASA ADR30, you can compare the effects of market volatilities on SIEMENS AG and NEL 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 SIEMENS AG with a short position of NEL ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIEMENS AG and NEL ASA.
Diversification Opportunities for SIEMENS AG and NEL ASA
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SIEMENS and NEL is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding SIEMENS AG SP and NEL ASA ADR30 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEL ASA ADR30 and SIEMENS AG 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 SIEMENS AG SP are associated (or correlated) with NEL ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEL ASA ADR30 has no effect on the direction of SIEMENS AG i.e., SIEMENS AG and NEL ASA go up and down completely randomly.
Pair Corralation between SIEMENS AG and NEL ASA
Assuming the 90 days trading horizon SIEMENS AG SP is expected to generate 0.59 times more return on investment than NEL ASA. However, SIEMENS AG SP is 1.69 times less risky than NEL ASA. It trades about 0.08 of its potential returns per unit of risk. NEL ASA ADR30 is currently generating about 0.02 per unit of risk. If you would invest 9,450 in SIEMENS AG SP on October 15, 2024 and sell it today you would earn a total of 250.00 from holding SIEMENS AG SP or generate 2.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIEMENS AG SP vs. NEL ASA ADR30
Performance |
| Timeline |
| SIEMENS AG SP |
| NEL ASA ADR30 |
SIEMENS AG and NEL ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIEMENS AG and NEL ASA
The main advantage of trading using opposite SIEMENS AG and NEL ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIEMENS AG position performs unexpectedly, NEL 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 NEL ASA will offset losses from the drop in NEL ASA's long position.| SIEMENS AG vs. Tradeweb Markets | SIEMENS AG vs. betterU Education Corp | SIEMENS AG vs. VIVA WINE GROUP | SIEMENS AG vs. Tradegate AG Wertpapierhandelsbank |
| NEL ASA vs. Superior Plus Corp | NEL ASA vs. NMI Holdings | NEL ASA vs. SIVERS SEMICONDUCTORS AB | NEL ASA vs. Talanx AG |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |