Correlation Between Newcap Holding and Columbus

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

By analyzing existing cross correlation between Newcap Holding AS and Columbus AS, you can compare the effects of market volatilities on Newcap Holding and Columbus 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 Newcap Holding with a short position of Columbus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newcap Holding and Columbus.

Diversification Opportunities for Newcap Holding and Columbus

0.0

Correlation Coefficient

Newcap Holding  Columbus

Pay attention - limited upside

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

Pair Corralation between Newcap Holding and Columbus

If you would invest  0.00  in Newcap Holding AS on October 6, 2024 and sell it today you would earn a total of  0.00  from holding Newcap Holding AS or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	2.5%
Values	Daily Returns

Newcap Holding AS  vs.  Columbus AS

Newcap Holding AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Newcap Holding AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Newcap Holding is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Columbus AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Columbus AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Newcap Holding and Columbus

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

The idea behind Newcap Holding AS and Columbus AS 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.