Correlation Between Deep Value and Sogn Sparebank
Can any of the company-specific risk be diversified away by investing in both Deep Value and Sogn Sparebank 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 Deep Value and Sogn Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deep Value Driller and Sogn Sparebank, you can compare the effects of market volatilities on Deep Value and Sogn Sparebank 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 Deep Value with a short position of Sogn Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deep Value and Sogn Sparebank.
Diversification Opportunities for Deep Value and Sogn Sparebank
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Deep and Sogn is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Deep Value Driller and Sogn Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sogn Sparebank and Deep Value 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 Deep Value Driller are associated (or correlated) with Sogn Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sogn Sparebank has no effect on the direction of Deep Value i.e., Deep Value and Sogn Sparebank go up and down completely randomly.
Pair Corralation between Deep Value and Sogn Sparebank
Assuming the 90 days trading horizon Deep Value Driller is expected to under-perform the Sogn Sparebank. In addition to that, Deep Value is 1.08 times more volatile than Sogn Sparebank. It trades about -0.08 of its total potential returns per unit of risk. Sogn Sparebank is currently generating about 0.13 per unit of volatility. If you would invest 18,428 in Sogn Sparebank on September 3, 2024 and sell it today you would earn a total of 7,967 from holding Sogn Sparebank or generate 43.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deep Value Driller vs. Sogn Sparebank
Performance |
| Timeline |
| Deep Value Driller |
| Sogn Sparebank |
Deep Value and Sogn Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deep Value and Sogn Sparebank
The main advantage of trading using opposite Deep Value and Sogn Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deep Value position performs unexpectedly, Sogn Sparebank 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 Sogn Sparebank will offset losses from the drop in Sogn Sparebank's long position.| Deep Value vs. Odfjell Technology | Deep Value vs. Xplora Technologies As | Deep Value vs. Austevoll Seafood ASA | Deep Value vs. 5Th Planet Games |
| Sogn Sparebank vs. Sparebanken Sor | Sogn Sparebank vs. SpareBank 1 stlandet | Sogn Sparebank vs. Holand og Setskog | Sogn Sparebank vs. Sparebank 1 Ringerike |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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