Correlation Between FinecoBank Banca and Nordea Bank
Can any of the company-specific risk be diversified away by investing in both FinecoBank Banca and Nordea 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 FinecoBank Banca and Nordea Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FinecoBank Banca Fineco and Nordea Bank Abp, you can compare the effects of market volatilities on FinecoBank Banca and Nordea 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 FinecoBank Banca with a short position of Nordea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of FinecoBank Banca and Nordea Bank.
Diversification Opportunities for FinecoBank Banca and Nordea Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FinecoBank and Nordea is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FinecoBank Banca Fineco and Nordea Bank Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordea Bank Abp and FinecoBank Banca 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 FinecoBank Banca Fineco are associated (or correlated) with Nordea Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordea Bank Abp has no effect on the direction of FinecoBank Banca i.e., FinecoBank Banca and Nordea Bank go up and down completely randomly.
Pair Corralation between FinecoBank Banca and Nordea Bank
Assuming the 90 days horizon FinecoBank Banca Fineco is expected to generate 2.54 times more return on investment than Nordea Bank. However, FinecoBank Banca is 2.54 times more volatile than Nordea Bank Abp. It trades about 0.04 of its potential returns per unit of risk. Nordea Bank Abp is currently generating about 0.03 per unit of risk. If you would invest 1,195 in FinecoBank Banca Fineco on August 30, 2024 and sell it today you would earn a total of 253.00 from holding FinecoBank Banca Fineco or generate 21.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 58.59% |
| Values | Daily Returns |
FinecoBank Banca Fineco vs. Nordea Bank Abp
Performance |
| Timeline |
| FinecoBank Banca Fineco |
| Nordea Bank Abp |
FinecoBank Banca and Nordea Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FinecoBank Banca and Nordea Bank
The main advantage of trading using opposite FinecoBank Banca and Nordea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FinecoBank Banca position performs unexpectedly, Nordea 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 Nordea Bank will offset losses from the drop in Nordea Bank's long position.The idea behind FinecoBank Banca Fineco and Nordea Bank Abp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Nordea Bank vs. Israel Discount Bank | Nordea Bank vs. Baraboo Bancorporation | Nordea Bank vs. Danske Bank AS | Nordea Bank vs. Jyske Bank 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |