Correlation Between ChemoMetec and Jyske Bank
Can any of the company-specific risk be diversified away by investing in both ChemoMetec and Jyske 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 ChemoMetec and Jyske Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChemoMetec AS and Jyske Bank AS, you can compare the effects of market volatilities on ChemoMetec and Jyske 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 ChemoMetec with a short position of Jyske Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChemoMetec and Jyske Bank.
Diversification Opportunities for ChemoMetec and Jyske Bank
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ChemoMetec and Jyske is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding ChemoMetec AS and Jyske Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jyske Bank AS and ChemoMetec 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 ChemoMetec AS are associated (or correlated) with Jyske Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jyske Bank AS has no effect on the direction of ChemoMetec i.e., ChemoMetec and Jyske Bank go up and down completely randomly.
Pair Corralation between ChemoMetec and Jyske Bank
Assuming the 90 days trading horizon ChemoMetec AS is expected to generate 4.67 times more return on investment than Jyske Bank. However, ChemoMetec is 4.67 times more volatile than Jyske Bank AS. It trades about 0.13 of its potential returns per unit of risk. Jyske Bank AS is currently generating about 0.06 per unit of risk. If you would invest 41,080 in ChemoMetec AS on August 30, 2024 and sell it today you would earn a total of 6,920 from holding ChemoMetec AS or generate 16.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChemoMetec AS vs. Jyske Bank AS
Performance |
| Timeline |
| ChemoMetec AS |
| Jyske Bank AS |
ChemoMetec and Jyske Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChemoMetec and Jyske Bank
The main advantage of trading using opposite ChemoMetec and Jyske Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChemoMetec position performs unexpectedly, Jyske 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 Jyske Bank will offset losses from the drop in Jyske Bank's long position.| ChemoMetec vs. cBrain AS | ChemoMetec vs. Ambu AS | ChemoMetec vs. Genmab AS | ChemoMetec vs. Zealand Pharma 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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