Correlation Between Spinnova and Nightingale Health
Can any of the company-specific risk be diversified away by investing in both Spinnova and Nightingale Health 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 Spinnova and Nightingale Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spinnova Oy and Nightingale Health Oyj, you can compare the effects of market volatilities on Spinnova and Nightingale Health 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 Spinnova with a short position of Nightingale Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spinnova and Nightingale Health.
Diversification Opportunities for Spinnova and Nightingale Health
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Spinnova and Nightingale is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Spinnova Oy and Nightingale Health Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nightingale Health Oyj and Spinnova 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 Spinnova Oy are associated (or correlated) with Nightingale Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nightingale Health Oyj has no effect on the direction of Spinnova i.e., Spinnova and Nightingale Health go up and down completely randomly.
Pair Corralation between Spinnova and Nightingale Health
Assuming the 90 days trading horizon Spinnova Oy is expected to under-perform the Nightingale Health. But the stock apears to be less risky and, when comparing its historical volatility, Spinnova Oy is 2.27 times less risky than Nightingale Health. The stock trades about -0.19 of its potential returns per unit of risk. The Nightingale Health Oyj is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 176.00 in Nightingale Health Oyj on September 1, 2024 and sell it today you would earn a total of 124.00 from holding Nightingale Health Oyj or generate 70.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spinnova Oy vs. Nightingale Health Oyj
Performance |
| Timeline |
| Spinnova Oy |
| Nightingale Health Oyj |
Spinnova and Nightingale Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spinnova and Nightingale Health
The main advantage of trading using opposite Spinnova and Nightingale Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spinnova position performs unexpectedly, Nightingale Health 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 Nightingale Health will offset losses from the drop in Nightingale Health's long position.| Spinnova vs. Qt Group Oyj | Spinnova vs. Kempower Oyj | Spinnova vs. Harvia Oyj | Spinnova vs. Nordea Bank Abp |
| Nightingale Health vs. Nokian Renkaat Oyj | Nightingale Health vs. CapMan Oyj B | Nightingale Health vs. EcoUp Oyj | Nightingale Health vs. HKFoods Oyj A |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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