Correlation Between 5Th Planet and Bien Sparebank
Can any of the company-specific risk be diversified away by investing in both 5Th Planet and Bien 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 5Th Planet and Bien Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 5Th Planet Games and Bien Sparebank ASA, you can compare the effects of market volatilities on 5Th Planet and Bien 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 5Th Planet with a short position of Bien Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of 5Th Planet and Bien Sparebank.
Diversification Opportunities for 5Th Planet and Bien Sparebank
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 5Th and Bien is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding 5Th Planet Games and Bien Sparebank ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bien Sparebank ASA and 5Th Planet 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 5Th Planet Games are associated (or correlated) with Bien Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bien Sparebank ASA has no effect on the direction of 5Th Planet i.e., 5Th Planet and Bien Sparebank go up and down completely randomly.
Pair Corralation between 5Th Planet and Bien Sparebank
Assuming the 90 days trading horizon 5Th Planet is expected to generate 3.16 times less return on investment than Bien Sparebank. In addition to that, 5Th Planet is 2.26 times more volatile than Bien Sparebank ASA. It trades about 0.04 of its total potential returns per unit of risk. Bien Sparebank ASA is currently generating about 0.26 per unit of volatility. If you would invest 9,300 in Bien Sparebank ASA on September 2, 2024 and sell it today you would earn a total of 3,100 from holding Bien Sparebank ASA or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
5Th Planet Games vs. Bien Sparebank ASA
Performance |
| Timeline |
| 5Th Planet Games |
| Bien Sparebank ASA |
5Th Planet and Bien Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 5Th Planet and Bien Sparebank
The main advantage of trading using opposite 5Th Planet and Bien Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 5Th Planet position performs unexpectedly, Bien 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 Bien Sparebank will offset losses from the drop in Bien Sparebank's long position.| 5Th Planet vs. Solstad Offsho | 5Th Planet vs. Saga Pure ASA | 5Th Planet vs. REC Silicon ASA | 5Th Planet vs. Kongsberg Automotive Holding |
| Bien Sparebank vs. Lea Bank ASA | Bien Sparebank vs. Elkem ASA | Bien Sparebank vs. Integrated Wind Solutions | Bien Sparebank vs. Vow ASA |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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