Correlation Between CBrain AS and Nordfyns Bank
Can any of the company-specific risk be diversified away by investing in both CBrain AS and Nordfyns Bank 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 CBrain AS and Nordfyns Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between cBrain AS and Nordfyns Bank AS, you can compare the effects of market volatilities on CBrain AS and Nordfyns Bank 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 CBrain AS with a short position of Nordfyns Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBrain AS and Nordfyns Bank.
Diversification Opportunities for CBrain AS and Nordfyns Bank
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CBrain and Nordfyns is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding cBrain AS and Nordfyns Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordfyns Bank AS and CBrain AS 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 cBrain AS are associated (or correlated) with Nordfyns Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordfyns Bank AS has no effect on the direction of CBrain AS i.e., CBrain AS and Nordfyns Bank go up and down completely randomly.
Pair Corralation between CBrain AS and Nordfyns Bank
Assuming the 90 days trading horizon cBrain AS is expected to generate 4.15 times more return on investment than Nordfyns Bank. However, CBrain AS is 4.15 times more volatile than Nordfyns Bank AS. It trades about -0.01 of its potential returns per unit of risk. Nordfyns Bank AS is currently generating about -0.25 per unit of risk. If you would invest 20,700 in cBrain AS on August 28, 2024 and sell it today you would lose (700.00) from holding cBrain AS or give up 3.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
cBrain AS vs. Nordfyns Bank AS
Performance |
| Timeline |
| cBrain AS |
| Nordfyns Bank AS |
CBrain AS and Nordfyns Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBrain AS and Nordfyns Bank
The main advantage of trading using opposite CBrain AS and Nordfyns Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBrain AS position performs unexpectedly, Nordfyns Bank 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 Nordfyns Bank will offset losses from the drop in Nordfyns Bank's long position.| CBrain AS vs. ChemoMetec AS | CBrain AS vs. Ambu AS | CBrain AS vs. Genmab AS | CBrain AS vs. Zealand Pharma AS |
| Nordfyns Bank vs. Skjern Bank AS | Nordfyns Bank vs. Lollands Bank | Nordfyns Bank vs. Djurslands Bank | Nordfyns Bank vs. Moens Bank 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |