Correlation Between Aurskog Sparebank and Sparebanken Ost
Can any of the company-specific risk be diversified away by investing in both Aurskog Sparebank and Sparebanken Ost 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 Aurskog Sparebank and Sparebanken Ost into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurskog Sparebank and Sparebanken Ost, you can compare the effects of market volatilities on Aurskog Sparebank and Sparebanken Ost 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 Aurskog Sparebank with a short position of Sparebanken Ost. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurskog Sparebank and Sparebanken Ost.
Diversification Opportunities for Aurskog Sparebank and Sparebanken Ost
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aurskog and Sparebanken is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Aurskog Sparebank and Sparebanken Ost in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparebanken Ost and Aurskog 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 Aurskog Sparebank are associated (or correlated) with Sparebanken Ost. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparebanken Ost has no effect on the direction of Aurskog Sparebank i.e., Aurskog Sparebank and Sparebanken Ost go up and down completely randomly.
Pair Corralation between Aurskog Sparebank and Sparebanken Ost
Assuming the 90 days trading horizon Aurskog Sparebank is expected to under-perform the Sparebanken Ost. But the stock apears to be less risky and, when comparing its historical volatility, Aurskog Sparebank is 1.55 times less risky than Sparebanken Ost. The stock trades about -0.03 of its potential returns per unit of risk. The Sparebanken Ost is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 6,535 in Sparebanken Ost on September 3, 2024 and sell it today you would lose (25.00) from holding Sparebanken Ost or give up 0.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurskog Sparebank vs. Sparebanken Ost
Performance |
| Timeline |
| Aurskog Sparebank |
| Sparebanken Ost |
Aurskog Sparebank and Sparebanken Ost Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurskog Sparebank and Sparebanken Ost
The main advantage of trading using opposite Aurskog Sparebank and Sparebanken Ost positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurskog Sparebank position performs unexpectedly, Sparebanken Ost 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 Sparebanken Ost will offset losses from the drop in Sparebanken Ost's long position.| Aurskog Sparebank vs. Melhus Sparebank | Aurskog Sparebank vs. Holand og Setskog | Aurskog Sparebank vs. Helgeland Sparebank | Aurskog Sparebank vs. Elkem ASA |
| Sparebanken Ost vs. Melhus Sparebank | Sparebanken Ost vs. Holand og Setskog | Sparebanken Ost vs. Helgeland Sparebank | Sparebanken Ost vs. Elkem 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |