Correlation Between BankIn Bredygt and Scandinavian Investment
Can any of the company-specific risk be diversified away by investing in both BankIn Bredygt and Scandinavian Investment 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 BankIn Bredygt and Scandinavian Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BankIn Bredygt Klimaakt and Scandinavian Investment Group, you can compare the effects of market volatilities on BankIn Bredygt and Scandinavian Investment 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 BankIn Bredygt with a short position of Scandinavian Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of BankIn Bredygt and Scandinavian Investment.
Diversification Opportunities for BankIn Bredygt and Scandinavian Investment
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between BankIn and Scandinavian is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding BankIn Bredygt Klimaakt and Scandinavian Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Investment and BankIn Bredygt 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 BankIn Bredygt Klimaakt are associated (or correlated) with Scandinavian Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandinavian Investment has no effect on the direction of BankIn Bredygt i.e., BankIn Bredygt and Scandinavian Investment go up and down completely randomly.
Pair Corralation between BankIn Bredygt and Scandinavian Investment
Assuming the 90 days trading horizon BankIn Bredygt Klimaakt is expected to generate 0.3 times more return on investment than Scandinavian Investment. However, BankIn Bredygt Klimaakt is 3.33 times less risky than Scandinavian Investment. It trades about 0.19 of its potential returns per unit of risk. Scandinavian Investment Group is currently generating about 0.01 per unit of risk. If you would invest 10,270 in BankIn Bredygt Klimaakt on October 19, 2024 and sell it today you would earn a total of 125.00 from holding BankIn Bredygt Klimaakt or generate 1.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 50.0% |
| Values | Daily Returns |
BankIn Bredygt Klimaakt vs. Scandinavian Investment Group
Performance |
| Timeline |
| BankIn Bredygt Klimaakt |
| Scandinavian Investment |
BankIn Bredygt and Scandinavian Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BankIn Bredygt and Scandinavian Investment
The main advantage of trading using opposite BankIn Bredygt and Scandinavian Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BankIn Bredygt position performs unexpectedly, Scandinavian Investment 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 Scandinavian Investment will offset losses from the drop in Scandinavian Investment's long position.| BankIn Bredygt vs. North Media AS | BankIn Bredygt vs. Djurslands Bank | BankIn Bredygt vs. Laan Spar Bank | BankIn Bredygt vs. Kreditbanken AS |
| Scandinavian Investment vs. North Media AS | Scandinavian Investment vs. Rovsing AS | Scandinavian Investment vs. Alm Brand | Scandinavian Investment vs. SKAKO 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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