Correlation Between Danske Bank and Coeur DAlene
Can any of the company-specific risk be diversified away by investing in both Danske Bank and Coeur DAlene 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 Bank and Coeur DAlene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Danske Bank AS and Coeur dAlene Bancorp, you can compare the effects of market volatilities on Danske Bank and Coeur DAlene 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 Bank with a short position of Coeur DAlene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Danske Bank and Coeur DAlene.
Diversification Opportunities for Danske Bank and Coeur DAlene
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Danske and Coeur is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Danske Bank AS and Coeur dAlene Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coeur dAlene Bancorp and Danske Bank 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 Bank AS are associated (or correlated) with Coeur DAlene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coeur dAlene Bancorp has no effect on the direction of Danske Bank i.e., Danske Bank and Coeur DAlene go up and down completely randomly.
Pair Corralation between Danske Bank and Coeur DAlene
Assuming the 90 days horizon Danske Bank AS is expected to under-perform the Coeur DAlene. But the pink sheet apears to be less risky and, when comparing its historical volatility, Danske Bank AS is 1.18 times less risky than Coeur DAlene. The pink sheet trades about -0.1 of its potential returns per unit of risk. The Coeur dAlene Bancorp is currently generating about 0.41 of returns per unit of risk over similar time horizon. If you would invest 1,410 in Coeur dAlene Bancorp on September 1, 2024 and sell it today you would earn a total of 265.00 from holding Coeur dAlene Bancorp or generate 18.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Danske Bank AS vs. Coeur dAlene Bancorp
Performance |
| Timeline |
| Danske Bank AS |
| Coeur dAlene Bancorp |
Danske Bank and Coeur DAlene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Danske Bank and Coeur DAlene
The main advantage of trading using opposite Danske Bank and Coeur DAlene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Danske Bank position performs unexpectedly, Coeur DAlene 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 Coeur DAlene will offset losses from the drop in Coeur DAlene's long position.| Danske Bank vs. Israel Discount Bank | Danske Bank vs. Baraboo Bancorporation | Danske Bank vs. Schweizerische Nationalbank | Danske Bank vs. Jyske Bank AS |
| Coeur DAlene vs. Oatly Group AB | Coeur DAlene vs. Luxfer Holdings PLC | Coeur DAlene vs. Hudson Technologies | Coeur DAlene vs. Molson Coors Brewing |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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