Correlation Between Nimbus Group and Duroc AB

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

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

Diversification Opportunities for Nimbus Group and Duroc AB

-0.09

Correlation Coefficient

Nimbus Group  Duroc AB

Good diversification

The 3 months correlation between Nimbus and Duroc is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Nimbus Group AB and Duroc AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duroc AB and Nimbus Group 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 Nimbus Group AB are associated (or correlated) with Duroc AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duroc AB has no effect on the direction of Nimbus Group i.e., Nimbus Group and Duroc AB go up and down completely randomly.

Pair Corralation between Nimbus Group and Duroc AB

Assuming the 90 days trading horizon Nimbus Group AB is expected to under-perform the Duroc AB. In addition to that, Nimbus Group is 1.63 times more volatile than Duroc AB. It trades about -0.02 of its total potential returns per unit of risk. Duroc AB is currently generating about 0.08 per unit of volatility. If you would invest  1,600  in Duroc AB on April 24, 2025 and sell it today you would earn a total of  120.00  from holding Duroc AB or generate 7.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Nimbus Group AB  vs.  Duroc AB

Nimbus Group AB

Risk-Adjusted Performance

Very Weak

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

Duroc AB

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Duroc AB are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Duroc AB may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Nimbus Group and Duroc AB

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

The idea behind Nimbus Group AB and Duroc AB 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.

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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.