Correlation Between Aktia Bank and Viking Line
Can any of the company-specific risk be diversified away by investing in both Aktia Bank and Viking Line 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 Aktia Bank and Viking Line into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aktia Bank Abp and Viking Line Abp, you can compare the effects of market volatilities on Aktia Bank and Viking Line 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 Aktia Bank with a short position of Viking Line. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aktia Bank and Viking Line.
Diversification Opportunities for Aktia Bank and Viking Line
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aktia and Viking is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Aktia Bank Abp and Viking Line Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viking Line Abp and Aktia Bank 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 Aktia Bank Abp are associated (or correlated) with Viking Line. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viking Line Abp has no effect on the direction of Aktia Bank i.e., Aktia Bank and Viking Line go up and down completely randomly.
Pair Corralation between Aktia Bank and Viking Line
Assuming the 90 days trading horizon Aktia Bank Abp is expected to generate 0.32 times more return on investment than Viking Line. However, Aktia Bank Abp is 3.08 times less risky than Viking Line. It trades about -0.09 of its potential returns per unit of risk. Viking Line Abp is currently generating about -0.04 per unit of risk. If you would invest 928.00 in Aktia Bank Abp on August 30, 2024 and sell it today you would lose (8.00) from holding Aktia Bank Abp or give up 0.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aktia Bank Abp vs. Viking Line Abp
Performance |
| Timeline |
| Aktia Bank Abp |
| Viking Line Abp |
Aktia Bank and Viking Line Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aktia Bank and Viking Line
The main advantage of trading using opposite Aktia Bank and Viking Line positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aktia Bank position performs unexpectedly, Viking Line 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 Viking Line will offset losses from the drop in Viking Line's long position.| Aktia Bank vs. Alandsbanken Abp B | Aktia Bank vs. CapMan Oyj B | Aktia Bank vs. Tokmanni Group Oyj | Aktia Bank vs. Oma Saastopankki Oyj |
| Viking Line vs. Harvia Oyj | Viking Line vs. Kamux Suomi Oy | Viking Line vs. Qt Group Oyj | Viking Line vs. Revenio Group |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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