Correlation Between Danske Andelskassers and Nordfyns Bank
Can any of the company-specific risk be diversified away by investing in both Danske Andelskassers 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 Danske Andelskassers and Nordfyns Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Danske Andelskassers Bank and Nordfyns Bank AS, you can compare the effects of market volatilities on Danske Andelskassers 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 Danske Andelskassers with a short position of Nordfyns Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Danske Andelskassers and Nordfyns Bank.
Diversification Opportunities for Danske Andelskassers and Nordfyns Bank
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Danske and Nordfyns is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Danske Andelskassers Bank 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 Danske Andelskassers 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 Danske Andelskassers Bank 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 Danske Andelskassers i.e., Danske Andelskassers and Nordfyns Bank go up and down completely randomly.
Pair Corralation between Danske Andelskassers and Nordfyns Bank
Assuming the 90 days trading horizon Danske Andelskassers Bank is expected to generate 1.26 times more return on investment than Nordfyns Bank. However, Danske Andelskassers is 1.26 times more volatile than Nordfyns Bank AS. It trades about -0.06 of its potential returns per unit of risk. Nordfyns Bank AS is currently generating about -0.5 per unit of risk. If you would invest 1,275 in Danske Andelskassers Bank on September 1, 2024 and sell it today you would lose (15.00) from holding Danske Andelskassers Bank or give up 1.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Danske Andelskassers Bank vs. Nordfyns Bank AS
Performance |
| Timeline |
| Danske Andelskassers Bank |
| Nordfyns Bank AS |
Danske Andelskassers and Nordfyns Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Danske Andelskassers and Nordfyns Bank
The main advantage of trading using opposite Danske Andelskassers and Nordfyns Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Danske Andelskassers 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.| Danske Andelskassers vs. Vestjysk Bank AS | Danske Andelskassers vs. Spar Nord Bank | Danske Andelskassers vs. Skjern Bank AS | Danske Andelskassers vs. RTX 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |