Correlation Between Nokia and Amadeus IT
Can any of the company-specific risk be diversified away by investing in both Nokia and Amadeus IT 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 Nokia and Amadeus IT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nokia and Amadeus IT Group, you can compare the effects of market volatilities on Nokia and Amadeus IT 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 Nokia with a short position of Amadeus IT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nokia and Amadeus IT.
Diversification Opportunities for Nokia and Amadeus IT
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nokia and Amadeus is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Nokia and Amadeus IT Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amadeus IT Group and Nokia 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 Nokia are associated (or correlated) with Amadeus IT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amadeus IT Group has no effect on the direction of Nokia i.e., Nokia and Amadeus IT go up and down completely randomly.
Pair Corralation between Nokia and Amadeus IT
Assuming the 90 days trading horizon Nokia is expected to generate 3.8 times more return on investment than Amadeus IT. However, Nokia is 3.8 times more volatile than Amadeus IT Group. It trades about 0.23 of its potential returns per unit of risk. Amadeus IT Group is currently generating about -0.08 per unit of risk. If you would invest 351.00 in Nokia on August 14, 2025 and sell it today you would earn a total of 242.00 from holding Nokia or generate 68.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nokia vs. Amadeus IT Group
Performance |
| Timeline |
| Nokia |
| Amadeus IT Group |
Nokia and Amadeus IT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nokia and Amadeus IT
The main advantage of trading using opposite Nokia and Amadeus IT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nokia position performs unexpectedly, Amadeus IT 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 Amadeus IT will offset losses from the drop in Amadeus IT's long position.| Nokia vs. Universal Health Realty | Nokia vs. Aedas Homes SA | Nokia vs. United Rentals | Nokia vs. NIGHTINGALE HEALTH EO |
| Amadeus IT vs. KINGBOARD CHEMICAL | Amadeus IT vs. NTG Nordic Transport | Amadeus IT vs. Television Broadcasts Limited | Amadeus IT vs. China BlueChemical |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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