Correlation Between DecideAct and Skjern Bank
Can any of the company-specific risk be diversified away by investing in both DecideAct and Skjern Bank 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 DecideAct and Skjern Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DecideAct AS and Skjern Bank AS, you can compare the effects of market volatilities on DecideAct and Skjern Bank 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 DecideAct with a short position of Skjern Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of DecideAct and Skjern Bank.
Diversification Opportunities for DecideAct and Skjern Bank
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DecideAct and Skjern is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding DecideAct AS and Skjern Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skjern Bank AS and DecideAct 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 DecideAct AS are associated (or correlated) with Skjern Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skjern Bank AS has no effect on the direction of DecideAct i.e., DecideAct and Skjern Bank go up and down completely randomly.
Pair Corralation between DecideAct and Skjern Bank
Assuming the 90 days trading horizon DecideAct AS is expected to generate 8.29 times more return on investment than Skjern Bank. However, DecideAct is 8.29 times more volatile than Skjern Bank AS. It trades about 0.05 of its potential returns per unit of risk. Skjern Bank AS is currently generating about -0.2 per unit of risk. If you would invest 178.00 in DecideAct AS on September 1, 2024 and sell it today you would earn a total of 4.00 from holding DecideAct AS or generate 2.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
DecideAct AS vs. Skjern Bank AS
Performance |
| Timeline |
| DecideAct AS |
| Skjern Bank AS |
DecideAct and Skjern Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DecideAct and Skjern Bank
The main advantage of trading using opposite DecideAct and Skjern Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DecideAct position performs unexpectedly, Skjern Bank 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 Skjern Bank will offset losses from the drop in Skjern Bank's long position.| DecideAct vs. FOM Technologies AS | DecideAct vs. cBrain AS | DecideAct vs. Green Hydrogen Systems | DecideAct vs. BioPorto |
| Skjern Bank vs. Laan Spar Bank | Skjern Bank vs. Kreditbanken AS | Skjern Bank vs. Nordea Bank Abp | Skjern Bank vs. Formuepleje Mix Medium |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |