Correlation Between Carlsberg and BankInvest Optima
Can any of the company-specific risk be diversified away by investing in both Carlsberg and BankInvest Optima 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 Carlsberg and BankInvest Optima into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlsberg AS and BankInvest Optima 30, you can compare the effects of market volatilities on Carlsberg and BankInvest Optima 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 Carlsberg with a short position of BankInvest Optima. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlsberg and BankInvest Optima.
Diversification Opportunities for Carlsberg and BankInvest Optima
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Carlsberg and BankInvest is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Carlsberg AS and BankInvest Optima 30 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BankInvest Optima and Carlsberg 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 Carlsberg AS are associated (or correlated) with BankInvest Optima. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BankInvest Optima has no effect on the direction of Carlsberg i.e., Carlsberg and BankInvest Optima go up and down completely randomly.
Pair Corralation between Carlsberg and BankInvest Optima
Assuming the 90 days trading horizon Carlsberg AS is expected to under-perform the BankInvest Optima. In addition to that, Carlsberg is 3.74 times more volatile than BankInvest Optima 30. It trades about -0.06 of its total potential returns per unit of risk. BankInvest Optima 30 is currently generating about 0.15 per unit of volatility. If you would invest 10,705 in BankInvest Optima 30 on August 29, 2024 and sell it today you would earn a total of 445.00 from holding BankInvest Optima 30 or generate 4.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Carlsberg AS vs. BankInvest Optima 30
Performance |
| Timeline |
| Carlsberg AS |
| BankInvest Optima |
Carlsberg and BankInvest Optima Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlsberg and BankInvest Optima
The main advantage of trading using opposite Carlsberg and BankInvest Optima positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlsberg position performs unexpectedly, BankInvest Optima 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 BankInvest Optima will offset losses from the drop in BankInvest Optima's long position.The idea behind Carlsberg AS and BankInvest Optima 30 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| BankInvest Optima vs. Ringkjoebing Landbobank AS | BankInvest Optima vs. Vestjysk Bank AS | BankInvest Optima vs. Sydbank AS | BankInvest Optima vs. Carnegie Wealth Management |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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