Correlation Between CBrain AS and Spar Nord
Can any of the company-specific risk be diversified away by investing in both CBrain AS and Spar Nord 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 Spar Nord into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between cBrain AS and Spar Nord Bank, you can compare the effects of market volatilities on CBrain AS and Spar Nord 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 Spar Nord. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBrain AS and Spar Nord.
Diversification Opportunities for CBrain AS and Spar Nord
Good diversification
The 3 months correlation between CBrain and Spar is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding cBrain AS and Spar Nord Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spar Nord Bank 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 Spar Nord. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spar Nord Bank has no effect on the direction of CBrain AS i.e., CBrain AS and Spar Nord go up and down completely randomly.
Pair Corralation between CBrain AS and Spar Nord
Assuming the 90 days trading horizon CBrain AS is expected to generate 1.25 times less return on investment than Spar Nord. In addition to that, CBrain AS is 1.97 times more volatile than Spar Nord Bank. It trades about 0.04 of its total potential returns per unit of risk. Spar Nord Bank is currently generating about 0.09 per unit of volatility. If you would invest 9,721 in Spar Nord Bank on August 25, 2024 and sell it today you would earn a total of 3,919 from holding Spar Nord Bank or generate 40.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
cBrain AS vs. Spar Nord Bank
Performance |
| Timeline |
| cBrain AS |
| Spar Nord Bank |
CBrain AS and Spar Nord Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBrain AS and Spar Nord
The main advantage of trading using opposite CBrain AS and Spar Nord positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBrain AS position performs unexpectedly, Spar Nord 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 Spar Nord will offset losses from the drop in Spar Nord's long position.| CBrain AS vs. ChemoMetec AS | CBrain AS vs. Ambu AS | CBrain AS vs. Genmab AS | CBrain AS vs. Zealand Pharma AS |
| Spar Nord vs. Dataproces Group AS | Spar Nord vs. cBrain AS | Spar Nord vs. ALK Abell AS | Spar Nord vs. ChemoMetec 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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