Correlation Between Talanx AG and NN Group
Can any of the company-specific risk be diversified away by investing in both Talanx AG and NN Group 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 Talanx AG and NN Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Talanx AG and NN Group NV, you can compare the effects of market volatilities on Talanx AG and NN Group 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 Talanx AG with a short position of NN Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Talanx AG and NN Group.
Diversification Opportunities for Talanx AG and NN Group
Very good diversification
The 3 months correlation between Talanx and 2NN is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Talanx AG and NN Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NN Group NV and Talanx 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 Talanx AG are associated (or correlated) with NN Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NN Group NV has no effect on the direction of Talanx AG i.e., Talanx AG and NN Group go up and down completely randomly.
Pair Corralation between Talanx AG and NN Group
Assuming the 90 days horizon Talanx AG is expected to generate 1.28 times more return on investment than NN Group. However, Talanx AG is 1.28 times more volatile than NN Group NV. It trades about 0.41 of its potential returns per unit of risk. NN Group NV is currently generating about -0.12 per unit of risk. If you would invest 7,080 in Talanx AG on September 1, 2024 and sell it today you would earn a total of 855.00 from holding Talanx AG or generate 12.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Talanx AG vs. NN Group NV
Performance |
| Timeline |
| Talanx AG |
| NN Group NV |
Talanx AG and NN Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Talanx AG and NN Group
The main advantage of trading using opposite Talanx AG and NN Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Talanx AG position performs unexpectedly, NN Group 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 NN Group will offset losses from the drop in NN Group's long position.| Talanx AG vs. Retail Estates NV | Talanx AG vs. COMMERCIAL VEHICLE | Talanx AG vs. Geely Automobile Holdings | Talanx AG vs. Commercial Vehicle Group |
| NN Group vs. AIR PRODCHEMICALS | NN Group vs. Mitsubishi Gas Chemical | NN Group vs. NISSAN CHEMICAL IND | NN Group vs. MagnaChip Semiconductor Corp |
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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