Correlation Between Bavarian Nordic and SKAKO AS
Can any of the company-specific risk be diversified away by investing in both Bavarian Nordic and SKAKO AS 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 SKAKO AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bavarian Nordic and SKAKO AS, you can compare the effects of market volatilities on Bavarian Nordic and SKAKO AS 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 SKAKO AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bavarian Nordic and SKAKO AS.
Diversification Opportunities for Bavarian Nordic and SKAKO AS
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bavarian and SKAKO is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Bavarian Nordic and SKAKO AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SKAKO AS 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 SKAKO AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SKAKO AS has no effect on the direction of Bavarian Nordic i.e., Bavarian Nordic and SKAKO AS go up and down completely randomly.
Pair Corralation between Bavarian Nordic and SKAKO AS
Assuming the 90 days trading horizon Bavarian Nordic is expected to generate 1.05 times more return on investment than SKAKO AS. However, Bavarian Nordic is 1.05 times more volatile than SKAKO AS. It trades about 0.17 of its potential returns per unit of risk. SKAKO AS is currently generating about -0.11 per unit of risk. If you would invest 18,530 in Bavarian Nordic on September 19, 2024 and sell it today you would earn a total of 1,365 from holding Bavarian Nordic or generate 7.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bavarian Nordic vs. SKAKO AS
Performance |
| Timeline |
| Bavarian Nordic |
| SKAKO AS |
Bavarian Nordic and SKAKO AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bavarian Nordic and SKAKO AS
The main advantage of trading using opposite Bavarian Nordic and SKAKO AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bavarian Nordic position performs unexpectedly, SKAKO AS 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 SKAKO AS will offset losses from the drop in SKAKO AS's long position.| Bavarian Nordic vs. Ambu AS | Bavarian Nordic vs. Danske Bank AS | Bavarian Nordic vs. Genmab AS | Bavarian Nordic vs. DSV Panalpina 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |