Correlation Between POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK
Can any of the company-specific risk be diversified away by investing in both POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK 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 POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK NK, you can compare the effects of market volatilities on POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK 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 POSBO UNSPADRS20YC1 with a short position of ROMERIKE SPAREBANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK.
Diversification Opportunities for POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between POSBO and ROMERIKE is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK NK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ROMERIKE SPAREBANK and POSBO UNSPADRS20YC1 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 POSBO UNSPADRS20YC1 are associated (or correlated) with ROMERIKE SPAREBANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ROMERIKE SPAREBANK has no effect on the direction of POSBO UNSPADRS20YC1 i.e., POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK go up and down completely randomly.
Pair Corralation between POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK
Assuming the 90 days trading horizon POSBO UNSPADRS20YC1 is expected to under-perform the ROMERIKE SPAREBANK. In addition to that, POSBO UNSPADRS20YC1 is 1.41 times more volatile than ROMERIKE SPAREBANK NK. It trades about -0.02 of its total potential returns per unit of risk. ROMERIKE SPAREBANK NK is currently generating about 0.07 per unit of volatility. If you would invest 1,060 in ROMERIKE SPAREBANK NK on September 15, 2024 and sell it today you would earn a total of 16.00 from holding ROMERIKE SPAREBANK NK or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
POSBO UNSPADRS20YC1 vs. ROMERIKE SPAREBANK NK
Performance |
| Timeline |
| POSBO UNSPADRS20YC1 |
| ROMERIKE SPAREBANK |
POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK
The main advantage of trading using opposite POSBO UNSPADRS20YC1 and ROMERIKE SPAREBANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POSBO UNSPADRS20YC1 position performs unexpectedly, ROMERIKE SPAREBANK 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 ROMERIKE SPAREBANK will offset losses from the drop in ROMERIKE SPAREBANK's long position.| POSBO UNSPADRS20YC1 vs. DISTRICT METALS | POSBO UNSPADRS20YC1 vs. EAGLE MATERIALS | POSBO UNSPADRS20YC1 vs. Perseus Mining Limited | POSBO UNSPADRS20YC1 vs. Evolution Mining Limited |
| ROMERIKE SPAREBANK vs. POSBO UNSPADRS20YC1 | ROMERIKE SPAREBANK vs. Postal Savings Bank | ROMERIKE SPAREBANK vs. UTD OV BK LOC ADR1 | ROMERIKE SPAREBANK vs. Superior Plus 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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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