Correlation Between DnB ASA and Kmc Properties
Can any of the company-specific risk be diversified away by investing in both DnB ASA and Kmc Properties 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 DnB ASA and Kmc Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DnB ASA and Kmc Properties ASA, you can compare the effects of market volatilities on DnB ASA and Kmc Properties 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 DnB ASA with a short position of Kmc Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of DnB ASA and Kmc Properties.
Diversification Opportunities for DnB ASA and Kmc Properties
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DnB and Kmc is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding DnB ASA and Kmc Properties ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kmc Properties ASA and DnB ASA 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 DnB ASA are associated (or correlated) with Kmc Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kmc Properties ASA has no effect on the direction of DnB ASA i.e., DnB ASA and Kmc Properties go up and down completely randomly.
Pair Corralation between DnB ASA and Kmc Properties
Assuming the 90 days trading horizon DnB ASA is expected to generate 0.1 times more return on investment than Kmc Properties. However, DnB ASA is 10.0 times less risky than Kmc Properties. It trades about 0.08 of its potential returns per unit of risk. Kmc Properties ASA is currently generating about -0.08 per unit of risk. If you would invest 20,220 in DnB ASA on September 3, 2024 and sell it today you would earn a total of 2,850 from holding DnB ASA or generate 14.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DnB ASA vs. Kmc Properties ASA
Performance |
| Timeline |
| DnB ASA |
| Kmc Properties ASA |
DnB ASA and Kmc Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DnB ASA and Kmc Properties
The main advantage of trading using opposite DnB ASA and Kmc Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DnB ASA position performs unexpectedly, Kmc Properties 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 Kmc Properties will offset losses from the drop in Kmc Properties' long position.| DnB ASA vs. Telenor ASA | DnB ASA vs. Storebrand ASA | DnB ASA vs. Orkla ASA | DnB ASA vs. Gjensidige Forsikring ASA |
| Kmc Properties vs. Entra ASA | Kmc Properties vs. Selvaag Bolig ASA | Kmc Properties vs. Olav Thon Eien | Kmc Properties vs. Pareto Bank ASA |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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