Correlation Between Truist Financial and Skandinaviska Enskilda
Can any of the company-specific risk be diversified away by investing in both Truist Financial and Skandinaviska Enskilda 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 Truist Financial and Skandinaviska Enskilda into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Truist Financial and Skandinaviska Enskilda Banken, you can compare the effects of market volatilities on Truist Financial and Skandinaviska Enskilda 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 Truist Financial with a short position of Skandinaviska Enskilda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truist Financial and Skandinaviska Enskilda.
Diversification Opportunities for Truist Financial and Skandinaviska Enskilda
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Truist and Skandinaviska is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Truist Financial and Skandinaviska Enskilda Banken in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skandinaviska Enskilda and Truist Financial 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 Truist Financial are associated (or correlated) with Skandinaviska Enskilda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skandinaviska Enskilda has no effect on the direction of Truist Financial i.e., Truist Financial and Skandinaviska Enskilda go up and down completely randomly.
Pair Corralation between Truist Financial and Skandinaviska Enskilda
Assuming the 90 days horizon Truist Financial is expected to generate 1.48 times more return on investment than Skandinaviska Enskilda. However, Truist Financial is 1.48 times more volatile than Skandinaviska Enskilda Banken. It trades about 0.13 of its potential returns per unit of risk. Skandinaviska Enskilda Banken is currently generating about 0.05 per unit of risk. If you would invest 3,690 in Truist Financial on November 1, 2024 and sell it today you would earn a total of 818.00 from holding Truist Financial or generate 22.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Truist Financial vs. Skandinaviska Enskilda Banken
Performance |
| Timeline |
| Truist Financial |
| Skandinaviska Enskilda |
Truist Financial and Skandinaviska Enskilda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truist Financial and Skandinaviska Enskilda
The main advantage of trading using opposite Truist Financial and Skandinaviska Enskilda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truist Financial position performs unexpectedly, Skandinaviska Enskilda 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 Skandinaviska Enskilda will offset losses from the drop in Skandinaviska Enskilda's long position.| Truist Financial vs. Corsair Gaming | Truist Financial vs. GAMING FAC SA | Truist Financial vs. TRAINLINE PLC LS | Truist Financial vs. CONTAGIOUS GAMING INC |
| Skandinaviska Enskilda vs. POSBO UNSPADRS20YC1 | Skandinaviska Enskilda vs. Postal Savings Bank | Skandinaviska Enskilda vs. Truist Financial | Skandinaviska Enskilda vs. OVERSEA CHINUNSPADR2 |
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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