Correlation Between Bavarian Nordic and Nykredit Invest
Can any of the company-specific risk be diversified away by investing in both Bavarian Nordic and Nykredit Invest 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 Bavarian Nordic and Nykredit Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bavarian Nordic and Nykredit Invest Korte, you can compare the effects of market volatilities on Bavarian Nordic and Nykredit Invest 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 Bavarian Nordic with a short position of Nykredit Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bavarian Nordic and Nykredit Invest.
Diversification Opportunities for Bavarian Nordic and Nykredit Invest
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bavarian and Nykredit is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Bavarian Nordic and Nykredit Invest Korte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nykredit Invest Korte and Bavarian Nordic 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 Bavarian Nordic are associated (or correlated) with Nykredit Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nykredit Invest Korte has no effect on the direction of Bavarian Nordic i.e., Bavarian Nordic and Nykredit Invest go up and down completely randomly.
Pair Corralation between Bavarian Nordic and Nykredit Invest
Assuming the 90 days trading horizon Bavarian Nordic is expected to generate 13.38 times less return on investment than Nykredit Invest. In addition to that, Bavarian Nordic is 73.95 times more volatile than Nykredit Invest Korte. It trades about 0.0 of its total potential returns per unit of risk. Nykredit Invest Korte is currently generating about 0.27 per unit of volatility. If you would invest 9,900 in Nykredit Invest Korte on September 13, 2024 and sell it today you would earn a total of 38.00 from holding Nykredit Invest Korte or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bavarian Nordic vs. Nykredit Invest Korte
Performance |
| Timeline |
| Bavarian Nordic |
| Nykredit Invest Korte |
Bavarian Nordic and Nykredit Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bavarian Nordic and Nykredit Invest
The main advantage of trading using opposite Bavarian Nordic and Nykredit Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bavarian Nordic position performs unexpectedly, Nykredit Invest 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 Nykredit Invest will offset losses from the drop in Nykredit Invest's long position.| Bavarian Nordic vs. Dataproces Group AS | Bavarian Nordic vs. cBrain AS | Bavarian Nordic vs. Nilfisk Holding AS | Bavarian Nordic vs. Danish Aerospace |
| Nykredit Invest vs. Novo Nordisk AS | Nykredit Invest vs. Nordea Bank Abp | Nykredit Invest vs. DSV Panalpina AS | Nykredit Invest vs. AP Mller |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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