Correlation Between Nordnet One and Nordnet Teknologi

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

By analyzing existing cross correlation between Nordnet One Balansert and Nordnet Teknologi Indeks, you can compare the effects of market volatilities on Nordnet One and Nordnet Teknologi 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 Nordnet One with a short position of Nordnet Teknologi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordnet One and Nordnet Teknologi.

Diversification Opportunities for Nordnet One and Nordnet Teknologi

0.64

Correlation Coefficient

Nordnet One  Nordnet Teknologi

Poor diversification

The 3 months correlation between Nordnet and Nordnet is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Nordnet One Balansert and Nordnet Teknologi Indeks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordnet Teknologi Indeks and Nordnet One 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 Nordnet One Balansert are associated (or correlated) with Nordnet Teknologi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordnet Teknologi Indeks has no effect on the direction of Nordnet One i.e., Nordnet One and Nordnet Teknologi go up and down completely randomly.

Pair Corralation between Nordnet One and Nordnet Teknologi

Assuming the 90 days trading horizon Nordnet One Balansert is expected to generate 0.29 times more return on investment than Nordnet Teknologi. However, Nordnet One Balansert is 3.5 times less risky than Nordnet Teknologi. It trades about -0.1 of its potential returns per unit of risk. Nordnet Teknologi Indeks is currently generating about -0.15 per unit of risk. If you would invest  13,786  in Nordnet One Balansert on December 28, 2024 and sell it today you would lose (406.00) from holding Nordnet One Balansert or give up 2.95% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

Nordnet One Balansert  vs.  Nordnet Teknologi Indeks

Nordnet One Balansert

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nordnet One Balansert has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable basic indicators, Nordnet One is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Nordnet Teknologi Indeks

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nordnet Teknologi Indeks has generated negative risk-adjusted returns adding no value to fund investors. In spite of inconsistent performance in the last few months, the Fund's primary indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the fund investors.

Pair Trading with Nordnet One and Nordnet Teknologi

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

The idea behind Nordnet One Balansert and Nordnet Teknologi Indeks 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.

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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.