Correlation Between Bavarian Nordic and Nordinvestments

Can any of the company-specific risk be diversified away by investing in both Bavarian Nordic and Nordinvestments 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 Bavarian Nordic and Nordinvestments into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bavarian Nordic and Nordinvestments AS, you can compare the effects of market volatilities on Bavarian Nordic and Nordinvestments 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 Bavarian Nordic with a short position of Nordinvestments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bavarian Nordic and Nordinvestments.

Diversification Opportunities for Bavarian Nordic and Nordinvestments

0.0

Correlation Coefficient

Bavarian Nordic  Nordinvestments

Pay attention - limited upside

The 3 months correlation between Bavarian and Nordinvestments is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bavarian Nordic and Nordinvestments AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordinvestments AS and Bavarian Nordic 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 Bavarian Nordic are associated (or correlated) with Nordinvestments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordinvestments AS has no effect on the direction of Bavarian Nordic i.e., Bavarian Nordic and Nordinvestments go up and down completely randomly.

Pair Corralation between Bavarian Nordic and Nordinvestments

If you would invest  123.00  in Nordinvestments AS on August 30, 2024 and sell it today you would earn a total of  0.00  from holding Nordinvestments AS or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Bavarian Nordic  vs.  Nordinvestments AS

Bavarian Nordic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bavarian Nordic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in December 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Nordinvestments AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nordinvestments AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Nordinvestments is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Bavarian Nordic and Nordinvestments

The main advantage of trading using opposite Bavarian Nordic and Nordinvestments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bavarian Nordic position performs unexpectedly, Nordinvestments 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 Nordinvestments will offset losses from the drop in Nordinvestments' long position.

The idea behind Bavarian Nordic and Nordinvestments AS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.