Correlation Between NCino and AMTD Digital
Can any of the company-specific risk be diversified away by investing in both NCino and AMTD Digital 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 NCino and AMTD Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between nCino Inc and AMTD Digital, you can compare the effects of market volatilities on NCino and AMTD Digital 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 NCino with a short position of AMTD Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of NCino and AMTD Digital.
Diversification Opportunities for NCino and AMTD Digital
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NCino and AMTD is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding nCino Inc and AMTD Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMTD Digital and NCino 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 nCino Inc are associated (or correlated) with AMTD Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMTD Digital has no effect on the direction of NCino i.e., NCino and AMTD Digital go up and down completely randomly.
Pair Corralation between NCino and AMTD Digital
Given the investment horizon of 90 days nCino Inc is expected to under-perform the AMTD Digital. But the stock apears to be less risky and, when comparing its historical volatility, nCino Inc is 3.95 times less risky than AMTD Digital. The stock trades about -0.31 of its potential returns per unit of risk. The AMTD Digital is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 262.00 in AMTD Digital on December 1, 2024 and sell it today you would lose (11.00) from holding AMTD Digital or give up 4.2% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
nCino Inc vs. AMTD Digital
Performance |
Timeline |
nCino Inc |
AMTD Digital |
NCino and AMTD Digital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with NCino and AMTD Digital
The main advantage of trading using opposite NCino and AMTD Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NCino position performs unexpectedly, AMTD Digital 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 AMTD Digital will offset losses from the drop in AMTD Digital's long position.NCino vs. Clearwater Analytics Holdings | NCino vs. Meridianlink | NCino vs. Bigcommerce Holdings | NCino vs. ZoomInfo Technologies |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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