Correlation Between NordTelekom Telecommunicatio and OPUS GLOBAL

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

By analyzing existing cross correlation between NordTelekom Telecommunications Service and OPUS GLOBAL Nyrt, you can compare the effects of market volatilities on NordTelekom Telecommunicatio and OPUS GLOBAL 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 NordTelekom Telecommunicatio with a short position of OPUS GLOBAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of NordTelekom Telecommunicatio and OPUS GLOBAL.

Diversification Opportunities for NordTelekom Telecommunicatio and OPUS GLOBAL

-0.49

Correlation Coefficient

NordTelekom Telecommunicatio  OPUS GLOBAL

Very good diversification

The 3 months correlation between NordTelekom and OPUS is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding NordTelekom Telecommunications and OPUS GLOBAL Nyrt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPUS GLOBAL Nyrt and NordTelekom Telecommunicatio 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 NordTelekom Telecommunications Service are associated (or correlated) with OPUS GLOBAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OPUS GLOBAL Nyrt has no effect on the direction of NordTelekom Telecommunicatio i.e., NordTelekom Telecommunicatio and OPUS GLOBAL go up and down completely randomly.

Pair Corralation between NordTelekom Telecommunicatio and OPUS GLOBAL

Assuming the 90 days trading horizon NordTelekom Telecommunications Service is expected to under-perform the OPUS GLOBAL. In addition to that, NordTelekom Telecommunicatio is 2.46 times more volatile than OPUS GLOBAL Nyrt. It trades about -0.01 of its total potential returns per unit of risk. OPUS GLOBAL Nyrt is currently generating about 0.16 per unit of volatility. If you would invest  51,100  in OPUS GLOBAL Nyrt on November 28, 2024 and sell it today you would earn a total of  7,400  from holding OPUS GLOBAL Nyrt or generate 14.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	93.1%
Values	Daily Returns

NordTelekom Telecommunications  vs.  OPUS GLOBAL Nyrt

NordTelekom Telecommunicatio

Risk-Adjusted Performance

Very Weak

Over the last 90 days NordTelekom Telecommunications Service has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, NordTelekom Telecommunicatio is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

OPUS GLOBAL Nyrt

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in OPUS GLOBAL Nyrt are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, OPUS GLOBAL unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NordTelekom Telecommunicatio and OPUS GLOBAL

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

The idea behind NordTelekom Telecommunications Service and OPUS GLOBAL Nyrt 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.