Correlation Between Nilfisk Holding and ATT
Can any of the company-specific risk be diversified away by investing in both Nilfisk Holding and ATT 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 Nilfisk Holding and ATT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nilfisk Holding AS and ATT Inc, you can compare the effects of market volatilities on Nilfisk Holding and ATT 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 Nilfisk Holding with a short position of ATT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nilfisk Holding and ATT.
Diversification Opportunities for Nilfisk Holding and ATT
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nilfisk and ATT is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Nilfisk Holding AS and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and Nilfisk Holding 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 Nilfisk Holding AS are associated (or correlated) with ATT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATT Inc has no effect on the direction of Nilfisk Holding i.e., Nilfisk Holding and ATT go up and down completely randomly.
Pair Corralation between Nilfisk Holding and ATT
Assuming the 90 days trading horizon Nilfisk Holding AS is expected to generate 1.43 times more return on investment than ATT. However, Nilfisk Holding is 1.43 times more volatile than ATT Inc. It trades about 0.14 of its potential returns per unit of risk. ATT Inc is currently generating about 0.07 per unit of risk. If you would invest 11,320 in Nilfisk Holding AS on January 17, 2024 and sell it today you would earn a total of 3,740 from holding Nilfisk Holding AS or generate 33.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nilfisk Holding AS vs. ATT Inc
Performance |
| Timeline |
| Nilfisk Holding AS |
| ATT Inc |
Nilfisk Holding and ATT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nilfisk Holding and ATT
The main advantage of trading using opposite Nilfisk Holding and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nilfisk Holding position performs unexpectedly, ATT 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 ATT will offset losses from the drop in ATT's long position.| Nilfisk Holding vs. cBrain AS | Nilfisk Holding vs. Netcompany Group AS | Nilfisk Holding vs. ChemoMetec AS |
| ATT vs. Aquagold International | ATT vs. Thrivent High Yield | ATT vs. Morningstar Unconstrained Allocation | ATT vs. Via Renewables |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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