Correlation Between DFDS AS and Danske Bank
Can any of the company-specific risk be diversified away by investing in both DFDS AS and Danske 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 DFDS AS and Danske Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DFDS AS and Danske Bank AS, you can compare the effects of market volatilities on DFDS AS and Danske 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 DFDS AS with a short position of Danske Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of DFDS AS and Danske Bank.
Diversification Opportunities for DFDS AS and Danske Bank
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DFDS and Danske is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding DFDS AS and Danske Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Danske Bank AS and DFDS 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 DFDS AS are associated (or correlated) with Danske Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Danske Bank AS has no effect on the direction of DFDS AS i.e., DFDS AS and Danske Bank go up and down completely randomly.
Pair Corralation between DFDS AS and Danske Bank
Assuming the 90 days trading horizon DFDS AS is expected to under-perform the Danske Bank. In addition to that, DFDS AS is 1.31 times more volatile than Danske Bank AS. It trades about -0.08 of its total potential returns per unit of risk. Danske Bank AS is currently generating about 0.09 per unit of volatility. If you would invest 11,964 in Danske Bank AS on October 25, 2024 and sell it today you would earn a total of 9,676 from holding Danske Bank AS or generate 80.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DFDS AS vs. Danske Bank AS
Performance |
| Timeline |
| DFDS AS |
| Danske Bank AS |
DFDS AS and Danske Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DFDS AS and Danske Bank
The main advantage of trading using opposite DFDS AS and Danske Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DFDS AS position performs unexpectedly, Danske 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 Danske Bank will offset losses from the drop in Danske Bank's long position.| DFDS AS vs. FLSmidth Co | DFDS AS vs. NKT AS | DFDS AS vs. Dampskibsselskabet Norden AS | DFDS AS vs. GN Store Nord |
| Danske Bank vs. Bavarian Nordic | Danske Bank vs. DSV Panalpina AS | Danske Bank vs. Vestas Wind Systems | Danske Bank vs. Ambu 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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