Correlation Between DNB Norge and Nordea 1
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By analyzing existing cross correlation between DNB Norge Selektiv and Nordea 1 , you can compare the effects of market volatilities on DNB Norge and Nordea 1 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 DNB Norge with a short position of Nordea 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of DNB Norge and Nordea 1.
Diversification Opportunities for DNB Norge and Nordea 1
Very weak diversification
The 3 months correlation between DNB and Nordea is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding DNB Norge Selektiv and Nordea 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordea 1 and DNB Norge 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 DNB Norge Selektiv are associated (or correlated) with Nordea 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordea 1 has no effect on the direction of DNB Norge i.e., DNB Norge and Nordea 1 go up and down completely randomly.
Pair Corralation between DNB Norge and Nordea 1
Assuming the 90 days trading horizon DNB Norge Selektiv is expected to generate 0.71 times more return on investment than Nordea 1. However, DNB Norge Selektiv is 1.41 times less risky than Nordea 1. It trades about 0.16 of its potential returns per unit of risk. Nordea 1 is currently generating about 0.1 per unit of risk. If you would invest 169,254 in DNB Norge Selektiv on November 2, 2024 and sell it today you would earn a total of 3,048 from holding DNB Norge Selektiv or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
DNB Norge Selektiv vs. Nordea 1
Performance |
| Timeline |
| DNB Norge Selektiv |
| Nordea 1 |
DNB Norge and Nordea 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DNB Norge and Nordea 1
The main advantage of trading using opposite DNB Norge and Nordea 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DNB Norge position performs unexpectedly, Nordea 1 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 Nordea 1 will offset losses from the drop in Nordea 1's long position.| DNB Norge vs. Franklin Floating Rate | DNB Norge vs. Franklin Floating Rate | DNB Norge vs. Franklin Floating Rate | DNB Norge vs. Dalata Hotel Group |
| Nordea 1 vs. KLP AksjeNorge Indeks | Nordea 1 vs. Storebrand Global Solutions | Nordea 1 vs. Franklin Floating Rate | Nordea 1 vs. Nordnet Teknologi Indeks |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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