Correlation Between Zaptec AS and Nanoform Finland
Can any of the company-specific risk be diversified away by investing in both Zaptec AS and Nanoform Finland 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 Zaptec AS and Nanoform Finland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zaptec AS and Nanoform Finland Plc, you can compare the effects of market volatilities on Zaptec AS and Nanoform Finland 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 Zaptec AS with a short position of Nanoform Finland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zaptec AS and Nanoform Finland.
Diversification Opportunities for Zaptec AS and Nanoform Finland
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zaptec and Nanoform is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Zaptec AS and Nanoform Finland Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanoform Finland Plc and Zaptec AS 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 Zaptec AS are associated (or correlated) with Nanoform Finland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanoform Finland Plc has no effect on the direction of Zaptec AS i.e., Zaptec AS and Nanoform Finland go up and down completely randomly.
Pair Corralation between Zaptec AS and Nanoform Finland
Assuming the 90 days trading horizon Zaptec AS is expected to generate 0.95 times more return on investment than Nanoform Finland. However, Zaptec AS is 1.06 times less risky than Nanoform Finland. It trades about -0.03 of its potential returns per unit of risk. Nanoform Finland Plc is currently generating about -0.03 per unit of risk. If you would invest 2,150 in Zaptec AS on September 14, 2024 and sell it today you would lose (1,218) from holding Zaptec AS or give up 56.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Zaptec AS vs. Nanoform Finland Plc
Performance |
| Timeline |
| Zaptec AS |
| Nanoform Finland Plc |
Zaptec AS and Nanoform Finland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zaptec AS and Nanoform Finland
The main advantage of trading using opposite Zaptec AS and Nanoform Finland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zaptec AS position performs unexpectedly, Nanoform Finland 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 Nanoform Finland will offset losses from the drop in Nanoform Finland's long position.| Zaptec AS vs. Kongsberg Automotive Holding | Zaptec AS vs. Bavarian Nordic | Zaptec AS vs. Everfuel AS | Zaptec AS vs. Elkem ASA |
| Nanoform Finland vs. Bavarian Nordic | Nanoform Finland vs. BioPorto | Nanoform Finland vs. Zaptec AS | Nanoform Finland vs. cBrain 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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