Correlation Between Agat Ejendomme and Newcap Holding
Can any of the company-specific risk be diversified away by investing in both Agat Ejendomme and Newcap Holding 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 Agat Ejendomme and Newcap Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agat Ejendomme AS and Newcap Holding AS, you can compare the effects of market volatilities on Agat Ejendomme and Newcap Holding 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 Agat Ejendomme with a short position of Newcap Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agat Ejendomme and Newcap Holding.
Diversification Opportunities for Agat Ejendomme and Newcap Holding
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Agat and Newcap is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Agat Ejendomme AS and Newcap Holding AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newcap Holding AS and Agat Ejendomme 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 Agat Ejendomme AS are associated (or correlated) with Newcap Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newcap Holding AS has no effect on the direction of Agat Ejendomme i.e., Agat Ejendomme and Newcap Holding go up and down completely randomly.
Pair Corralation between Agat Ejendomme and Newcap Holding
Assuming the 90 days trading horizon Agat Ejendomme AS is expected to under-perform the Newcap Holding. But the stock apears to be less risky and, when comparing its historical volatility, Agat Ejendomme AS is 11.96 times less risky than Newcap Holding. The stock trades about -0.03 of its potential returns per unit of risk. The Newcap Holding AS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 18.00 in Newcap Holding AS on August 29, 2024 and sell it today you would lose (8.25) from holding Newcap Holding AS or give up 45.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agat Ejendomme AS vs. Newcap Holding AS
Performance |
| Timeline |
| Agat Ejendomme AS |
| Newcap Holding AS |
Agat Ejendomme and Newcap Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agat Ejendomme and Newcap Holding
The main advantage of trading using opposite Agat Ejendomme and Newcap Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agat Ejendomme position performs unexpectedly, Newcap Holding 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 Newcap Holding will offset losses from the drop in Newcap Holding's long position.| Agat Ejendomme vs. Cemat AS | Agat Ejendomme vs. Columbus AS | Agat Ejendomme vs. Harboes Bryggeri AS | Agat Ejendomme vs. Copenhagen Capital AS |
| Newcap Holding vs. SKAKO AS | Newcap Holding vs. Lollands Bank | Newcap Holding vs. Scandinavian Brake Systems | Newcap Holding vs. Rovsing 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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