Correlation Between Postal Savings and NORDIC HALIBUT
Can any of the company-specific risk be diversified away by investing in both Postal Savings and NORDIC HALIBUT 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 Postal Savings and NORDIC HALIBUT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postal Savings Bank and NORDIC HALIBUT AS, you can compare the effects of market volatilities on Postal Savings and NORDIC HALIBUT 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 Postal Savings with a short position of NORDIC HALIBUT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Savings and NORDIC HALIBUT.
Diversification Opportunities for Postal Savings and NORDIC HALIBUT
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Postal and NORDIC is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Postal Savings Bank and NORDIC HALIBUT AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORDIC HALIBUT AS and Postal Savings 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 Postal Savings Bank are associated (or correlated) with NORDIC HALIBUT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORDIC HALIBUT AS has no effect on the direction of Postal Savings i.e., Postal Savings and NORDIC HALIBUT go up and down completely randomly.
Pair Corralation between Postal Savings and NORDIC HALIBUT
Assuming the 90 days horizon Postal Savings Bank is expected to generate 2.55 times more return on investment than NORDIC HALIBUT. However, Postal Savings is 2.55 times more volatile than NORDIC HALIBUT AS. It trades about 0.08 of its potential returns per unit of risk. NORDIC HALIBUT AS is currently generating about -0.01 per unit of risk. If you would invest 7.19 in Postal Savings Bank on September 13, 2024 and sell it today you would earn a total of 46.81 from holding Postal Savings Bank or generate 651.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postal Savings Bank vs. NORDIC HALIBUT AS
Performance |
| Timeline |
| Postal Savings Bank |
| NORDIC HALIBUT AS |
Postal Savings and NORDIC HALIBUT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postal Savings and NORDIC HALIBUT
The main advantage of trading using opposite Postal Savings and NORDIC HALIBUT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Savings position performs unexpectedly, NORDIC HALIBUT 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 NORDIC HALIBUT will offset losses from the drop in NORDIC HALIBUT's long position.| Postal Savings vs. POSBO UNSPADRS20YC1 | Postal Savings vs. UTD OV BK LOC ADR1 | Postal Savings vs. Superior Plus Corp | Postal Savings vs. SIVERS SEMICONDUCTORS AB |
| NORDIC HALIBUT vs. HEALTHCARE REAL A | NORDIC HALIBUT vs. ANTA SPORTS PRODUCT | NORDIC HALIBUT vs. Big 5 Sporting | NORDIC HALIBUT vs. ATRYS HEALTH SA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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