Correlation Between Nordic Semiconductor and Gamma Communications
Can any of the company-specific risk be diversified away by investing in both Nordic Semiconductor and Gamma Communications 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 Nordic Semiconductor and Gamma Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Semiconductor ASA and Gamma Communications PLC, you can compare the effects of market volatilities on Nordic Semiconductor and Gamma Communications 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 Nordic Semiconductor with a short position of Gamma Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Semiconductor and Gamma Communications.
Diversification Opportunities for Nordic Semiconductor and Gamma Communications
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nordic and Gamma is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Semiconductor ASA and Gamma Communications PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamma Communications PLC and Nordic Semiconductor 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 Nordic Semiconductor ASA are associated (or correlated) with Gamma Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamma Communications PLC has no effect on the direction of Nordic Semiconductor i.e., Nordic Semiconductor and Gamma Communications go up and down completely randomly.
Pair Corralation between Nordic Semiconductor and Gamma Communications
Assuming the 90 days trading horizon Nordic Semiconductor ASA is expected to generate 1.38 times more return on investment than Gamma Communications. However, Nordic Semiconductor is 1.38 times more volatile than Gamma Communications PLC. It trades about 0.14 of its potential returns per unit of risk. Gamma Communications PLC is currently generating about -0.1 per unit of risk. If you would invest 11,515 in Nordic Semiconductor ASA on April 23, 2025 and sell it today you would earn a total of 2,985 from holding Nordic Semiconductor ASA or generate 25.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Nordic Semiconductor ASA vs. Gamma Communications PLC
Performance |
Timeline |
Nordic Semiconductor ASA |
Gamma Communications PLC |
Nordic Semiconductor and Gamma Communications Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Nordic Semiconductor and Gamma Communications
The main advantage of trading using opposite Nordic Semiconductor and Gamma Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Semiconductor position performs unexpectedly, Gamma Communications 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 Gamma Communications will offset losses from the drop in Gamma Communications' long position.Nordic Semiconductor vs. Vulcan Materials Co | Nordic Semiconductor vs. Infrastrutture Wireless Italiane | Nordic Semiconductor vs. Associated British Foods | Nordic Semiconductor vs. Veolia Environnement VE |
Gamma Communications vs. Samsung Electronics Co | Gamma Communications vs. Samsung Electronics Co | Gamma Communications vs. Samsung Electronics Co | Gamma Communications vs. Toyota Motor Corp |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
Money Managers Screen money managers from public funds and ETFs managed around the world | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |