Correlation Between Aasen Sparebank and Xplora Technologies
Can any of the company-specific risk be diversified away by investing in both Aasen Sparebank and Xplora Technologies 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 Aasen Sparebank and Xplora Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aasen Sparebank and Xplora Technologies As, you can compare the effects of market volatilities on Aasen Sparebank and Xplora Technologies 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 Aasen Sparebank with a short position of Xplora Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aasen Sparebank and Xplora Technologies.
Diversification Opportunities for Aasen Sparebank and Xplora Technologies
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aasen and Xplora is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Aasen Sparebank and Xplora Technologies As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xplora Technologies and Aasen Sparebank 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 Aasen Sparebank are associated (or correlated) with Xplora Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xplora Technologies has no effect on the direction of Aasen Sparebank i.e., Aasen Sparebank and Xplora Technologies go up and down completely randomly.
Pair Corralation between Aasen Sparebank and Xplora Technologies
Assuming the 90 days trading horizon Aasen Sparebank is expected to generate 23.52 times less return on investment than Xplora Technologies. But when comparing it to its historical volatility, Aasen Sparebank is 2.3 times less risky than Xplora Technologies. It trades about 0.02 of its potential returns per unit of risk. Xplora Technologies As is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,275 in Xplora Technologies As on September 3, 2024 and sell it today you would earn a total of 1,875 from holding Xplora Technologies As or generate 147.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aasen Sparebank vs. Xplora Technologies As
Performance |
| Timeline |
| Aasen Sparebank |
| Xplora Technologies |
Aasen Sparebank and Xplora Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aasen Sparebank and Xplora Technologies
The main advantage of trading using opposite Aasen Sparebank and Xplora Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aasen Sparebank position performs unexpectedly, Xplora Technologies 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 Xplora Technologies will offset losses from the drop in Xplora Technologies' long position.| Aasen Sparebank vs. DnB ASA | Aasen Sparebank vs. Sparebank 1 SR | Aasen Sparebank vs. Sparebank 1 SMN | Aasen Sparebank vs. Sparebanken Mre |
| Xplora Technologies vs. Airthings ASA | Xplora Technologies vs. Nordic Unmanned As | Xplora Technologies vs. Pexip Holding ASA | Xplora Technologies vs. Huddlestock Fintech As |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |