Correlation Between BW OFFSHORE and NTG Nordic
Can any of the company-specific risk be diversified away by investing in both BW OFFSHORE and NTG Nordic 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 BW OFFSHORE and NTG Nordic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BW OFFSHORE LTD and NTG Nordic Transport, you can compare the effects of market volatilities on BW OFFSHORE and NTG Nordic 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 BW OFFSHORE with a short position of NTG Nordic. Check out your portfolio center. Please also check ongoing floating volatility patterns of BW OFFSHORE and NTG Nordic.
Diversification Opportunities for BW OFFSHORE and NTG Nordic
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between XY81 and NTG is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding BW OFFSHORE LTD and NTG Nordic Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NTG Nordic Transport and BW OFFSHORE 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 BW OFFSHORE LTD are associated (or correlated) with NTG Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NTG Nordic Transport has no effect on the direction of BW OFFSHORE i.e., BW OFFSHORE and NTG Nordic go up and down completely randomly.
Pair Corralation between BW OFFSHORE and NTG Nordic
Assuming the 90 days trading horizon BW OFFSHORE LTD is expected to generate 0.94 times more return on investment than NTG Nordic. However, BW OFFSHORE LTD is 1.06 times less risky than NTG Nordic. It trades about 0.05 of its potential returns per unit of risk. NTG Nordic Transport is currently generating about -0.04 per unit of risk. If you would invest 182.00 in BW OFFSHORE LTD on October 12, 2024 and sell it today you would earn a total of 79.00 from holding BW OFFSHORE LTD or generate 43.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BW OFFSHORE LTD vs. NTG Nordic Transport
Performance |
| Timeline |
| BW OFFSHORE LTD |
| NTG Nordic Transport |
BW OFFSHORE and NTG Nordic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BW OFFSHORE and NTG Nordic
The main advantage of trading using opposite BW OFFSHORE and NTG Nordic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BW OFFSHORE position performs unexpectedly, NTG Nordic 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 NTG Nordic will offset losses from the drop in NTG Nordic's long position.| BW OFFSHORE vs. CarsalesCom | BW OFFSHORE vs. SANOK RUBBER ZY | BW OFFSHORE vs. Mitsubishi Materials | BW OFFSHORE vs. Vulcan Materials |
| NTG Nordic vs. KIMBALL ELECTRONICS | NTG Nordic vs. Methode Electronics | NTG Nordic vs. Mitsui Chemicals | NTG Nordic vs. BW OFFSHORE LTD |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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