Correlation Between Bien Sparebank and Polaris Media
Can any of the company-specific risk be diversified away by investing in both Bien Sparebank and Polaris Media 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 Bien Sparebank and Polaris Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bien Sparebank ASA and Polaris Media, you can compare the effects of market volatilities on Bien Sparebank and Polaris Media 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 Bien Sparebank with a short position of Polaris Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bien Sparebank and Polaris Media.
Diversification Opportunities for Bien Sparebank and Polaris Media
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bien and Polaris is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Bien Sparebank ASA and Polaris Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polaris Media and Bien 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 Bien Sparebank ASA are associated (or correlated) with Polaris Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polaris Media has no effect on the direction of Bien Sparebank i.e., Bien Sparebank and Polaris Media go up and down completely randomly.
Pair Corralation between Bien Sparebank and Polaris Media
Assuming the 90 days trading horizon Bien Sparebank ASA is expected to generate 1.13 times more return on investment than Polaris Media. However, Bien Sparebank is 1.13 times more volatile than Polaris Media. It trades about 0.19 of its potential returns per unit of risk. Polaris Media is currently generating about 0.05 per unit of risk. If you would invest 12,900 in Bien Sparebank ASA on November 27, 2024 and sell it today you would earn a total of 1,400 from holding Bien Sparebank ASA or generate 10.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bien Sparebank ASA vs. Polaris Media
Performance |
| Timeline |
| Bien Sparebank ASA |
| Polaris Media |
Bien Sparebank and Polaris Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bien Sparebank and Polaris Media
The main advantage of trading using opposite Bien Sparebank and Polaris Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bien Sparebank position performs unexpectedly, Polaris Media 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 Polaris Media will offset losses from the drop in Polaris Media's long position.| Bien Sparebank vs. SpareBank 1 stlandet | Bien Sparebank vs. Goodtech | Bien Sparebank vs. Techstep ASA | Bien Sparebank vs. Xplora Technologies As |
| Polaris Media vs. Kid ASA | Polaris Media vs. Byggma | Polaris Media vs. American Shipping | Polaris Media vs. Kitron 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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