Correlation Between BankInvest Optima and ROCKWOOL International
Can any of the company-specific risk be diversified away by investing in both BankInvest Optima and ROCKWOOL International 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 BankInvest Optima and ROCKWOOL International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BankInvest Optima 30 and ROCKWOOL International AS, you can compare the effects of market volatilities on BankInvest Optima and ROCKWOOL International 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 BankInvest Optima with a short position of ROCKWOOL International. Check out your portfolio center. Please also check ongoing floating volatility patterns of BankInvest Optima and ROCKWOOL International.
Diversification Opportunities for BankInvest Optima and ROCKWOOL International
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BankInvest and ROCKWOOL is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding BankInvest Optima 30 and ROCKWOOL International AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ROCKWOOL International and BankInvest Optima 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 BankInvest Optima 30 are associated (or correlated) with ROCKWOOL International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ROCKWOOL International has no effect on the direction of BankInvest Optima i.e., BankInvest Optima and ROCKWOOL International go up and down completely randomly.
Pair Corralation between BankInvest Optima and ROCKWOOL International
Assuming the 90 days trading horizon BankInvest Optima 30 is expected to generate 0.31 times more return on investment than ROCKWOOL International. However, BankInvest Optima 30 is 3.23 times less risky than ROCKWOOL International. It trades about 0.05 of its potential returns per unit of risk. ROCKWOOL International AS is currently generating about -0.01 per unit of risk. If you would invest 11,160 in BankInvest Optima 30 on October 20, 2024 and sell it today you would earn a total of 30.00 from holding BankInvest Optima 30 or generate 0.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
BankInvest Optima 30 vs. ROCKWOOL International AS
Performance |
| Timeline |
| BankInvest Optima |
| ROCKWOOL International |
BankInvest Optima and ROCKWOOL International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BankInvest Optima and ROCKWOOL International
The main advantage of trading using opposite BankInvest Optima and ROCKWOOL International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BankInvest Optima position performs unexpectedly, ROCKWOOL International 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 ROCKWOOL International will offset losses from the drop in ROCKWOOL International's long position.| BankInvest Optima vs. Novo Nordisk AS | BankInvest Optima vs. Nordea Bank Abp | BankInvest Optima vs. DSV Panalpina AS | BankInvest Optima vs. AP Mller |
| ROCKWOOL International vs. FLSmidth Co | ROCKWOOL International vs. GN Store Nord | ROCKWOOL International vs. Ambu AS | ROCKWOOL International 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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