Correlation Between Nok Airlines and AlzChem Group

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

By analyzing existing cross correlation between Nok Airlines PCL and AlzChem Group AG, you can compare the effects of market volatilities on Nok Airlines and AlzChem 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 Nok Airlines with a short position of AlzChem Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nok Airlines and AlzChem Group.

Diversification Opportunities for Nok Airlines and AlzChem Group

0.0

Correlation Coefficient

Nok Airlines  AlzChem Group

Pay attention - limited upside

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

Pair Corralation between Nok Airlines and AlzChem Group

If you would invest  4,860  in AlzChem Group AG on September 29, 2024 and sell it today you would earn a total of  1,020  from holding AlzChem Group AG or generate 20.99% return on investment over 90 days.

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

Nok Airlines PCL  vs.  AlzChem Group AG

Nok Airlines PCL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nok Airlines PCL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Nok Airlines is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

AlzChem Group AG

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AlzChem Group AG are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, AlzChem Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nok Airlines and AlzChem Group

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

The idea behind Nok Airlines PCL and AlzChem Group AG 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.