Correlation Between Norsk Hydro and Soken Chemical
Can any of the company-specific risk be diversified away by investing in both Norsk Hydro and Soken Chemical 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 Norsk Hydro and Soken Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Norsk Hydro ASA and Soken Chemical Engineering, you can compare the effects of market volatilities on Norsk Hydro and Soken Chemical 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 Norsk Hydro with a short position of Soken Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Norsk Hydro and Soken Chemical.
Diversification Opportunities for Norsk Hydro and Soken Chemical
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Norsk and Soken is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Norsk Hydro ASA and Soken Chemical Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soken Chemical Engin and Norsk Hydro 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 Norsk Hydro ASA are associated (or correlated) with Soken Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soken Chemical Engin has no effect on the direction of Norsk Hydro i.e., Norsk Hydro and Soken Chemical go up and down completely randomly.
Pair Corralation between Norsk Hydro and Soken Chemical
If you would invest 557.00 in Norsk Hydro ASA on September 15, 2024 and sell it today you would earn a total of 6.00 from holding Norsk Hydro ASA or generate 1.08% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Norsk Hydro ASA vs. Soken Chemical Engineering
Performance |
Timeline |
Norsk Hydro ASA |
Soken Chemical Engin |
Norsk Hydro and Soken Chemical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Norsk Hydro and Soken Chemical
The main advantage of trading using opposite Norsk Hydro and Soken Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Norsk Hydro position performs unexpectedly, Soken Chemical 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 Soken Chemical will offset losses from the drop in Soken Chemical's long position.Norsk Hydro vs. GALENA MINING LTD | Norsk Hydro vs. Cogent Communications Holdings | Norsk Hydro vs. GREENX METALS LTD | Norsk Hydro vs. T MOBILE US |
Soken Chemical vs. Albemarle | Soken Chemical vs. Superior Plus Corp | Soken Chemical vs. SIVERS SEMICONDUCTORS AB | Soken Chemical vs. Norsk Hydro ASA |
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 CEOs Directory module to screen CEOs from public companies around the world.
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