Correlation Between Trifork Holding and Netcompany Group
Can any of the company-specific risk be diversified away by investing in both Trifork Holding and Netcompany 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 Trifork Holding and Netcompany Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trifork Holding AG and Netcompany Group AS, you can compare the effects of market volatilities on Trifork Holding and Netcompany 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 Trifork Holding with a short position of Netcompany Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trifork Holding and Netcompany Group.
Diversification Opportunities for Trifork Holding and Netcompany Group
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Trifork and Netcompany is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Trifork Holding AG and Netcompany Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netcompany Group and Trifork Holding 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 Trifork Holding AG are associated (or correlated) with Netcompany Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netcompany Group has no effect on the direction of Trifork Holding i.e., Trifork Holding and Netcompany Group go up and down completely randomly.
Pair Corralation between Trifork Holding and Netcompany Group
Assuming the 90 days trading horizon Trifork Holding AG is expected to under-perform the Netcompany Group. But the stock apears to be less risky and, when comparing its historical volatility, Trifork Holding AG is 1.0 times less risky than Netcompany Group. The stock trades about -0.05 of its potential returns per unit of risk. The Netcompany Group AS is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 27,420 in Netcompany Group AS on November 5, 2024 and sell it today you would earn a total of 1,980 from holding Netcompany Group AS or generate 7.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trifork Holding AG vs. Netcompany Group AS
Performance |
| Timeline |
| Trifork Holding AG |
| Netcompany Group |
Trifork Holding and Netcompany Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trifork Holding and Netcompany Group
The main advantage of trading using opposite Trifork Holding and Netcompany Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trifork Holding position performs unexpectedly, Netcompany 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 Netcompany Group will offset losses from the drop in Netcompany Group's long position.| Trifork Holding vs. Novo Nordisk AS | Trifork Holding vs. Nordea Bank Abp | Trifork Holding vs. DSV Panalpina AS | Trifork Holding vs. AP Mller |
| Netcompany Group vs. GN Store Nord | Netcompany Group vs. Ambu AS | Netcompany Group vs. ROCKWOOL International AS | Netcompany Group vs. Genmab 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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