Correlation Between Europris ASA and Gyldendal ASA
Can any of the company-specific risk be diversified away by investing in both Europris ASA and Gyldendal ASA 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 Europris ASA and Gyldendal ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Europris ASA and Gyldendal ASA, you can compare the effects of market volatilities on Europris ASA and Gyldendal ASA 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 Europris ASA with a short position of Gyldendal ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Europris ASA and Gyldendal ASA.
Diversification Opportunities for Europris ASA and Gyldendal ASA
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Europris and Gyldendal is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Europris ASA and Gyldendal ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gyldendal ASA and Europris 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 Europris ASA are associated (or correlated) with Gyldendal ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gyldendal ASA has no effect on the direction of Europris ASA i.e., Europris ASA and Gyldendal ASA go up and down completely randomly.
Pair Corralation between Europris ASA and Gyldendal ASA
Assuming the 90 days trading horizon Europris ASA is expected to generate 0.63 times more return on investment than Gyldendal ASA. However, Europris ASA is 1.59 times less risky than Gyldendal ASA. It trades about 0.02 of its potential returns per unit of risk. Gyldendal ASA is currently generating about -0.02 per unit of risk. If you would invest 5,828 in Europris ASA on August 29, 2024 and sell it today you would earn a total of 632.00 from holding Europris ASA or generate 10.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Europris ASA vs. Gyldendal ASA
Performance |
| Timeline |
| Europris ASA |
| Gyldendal ASA |
Europris ASA and Gyldendal ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Europris ASA and Gyldendal ASA
The main advantage of trading using opposite Europris ASA and Gyldendal ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Europris ASA position performs unexpectedly, Gyldendal ASA 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 Gyldendal ASA will offset losses from the drop in Gyldendal ASA's long position.| Europris ASA vs. Storebrand ASA | Europris ASA vs. XXL ASA | Europris ASA vs. Orkla ASA | Europris ASA vs. DnB ASA |
| Gyldendal ASA vs. Europris ASA | Gyldendal ASA vs. Selvaag Bolig ASA | Gyldendal ASA vs. Storebrand ASA | Gyldendal ASA vs. Kitron 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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