Correlation Between Formuepleje Mix and Dataproces Group
Can any of the company-specific risk be diversified away by investing in both Formuepleje Mix and Dataproces Group 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 Formuepleje Mix and Dataproces Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Formuepleje Mix Medium and Dataproces Group AS, you can compare the effects of market volatilities on Formuepleje Mix and Dataproces Group 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 Formuepleje Mix with a short position of Dataproces Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Formuepleje Mix and Dataproces Group.
Diversification Opportunities for Formuepleje Mix and Dataproces Group
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Formuepleje and Dataproces is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Formuepleje Mix Medium and Dataproces Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dataproces Group and Formuepleje Mix 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 Formuepleje Mix Medium are associated (or correlated) with Dataproces Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dataproces Group has no effect on the direction of Formuepleje Mix i.e., Formuepleje Mix and Dataproces Group go up and down completely randomly.
Pair Corralation between Formuepleje Mix and Dataproces Group
Assuming the 90 days trading horizon Formuepleje Mix is expected to generate 6.7 times less return on investment than Dataproces Group. But when comparing it to its historical volatility, Formuepleje Mix Medium is 6.57 times less risky than Dataproces Group. It trades about 0.09 of its potential returns per unit of risk. Dataproces Group AS is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 177.00 in Dataproces Group AS on September 19, 2024 and sell it today you would earn a total of 418.00 from holding Dataproces Group AS or generate 236.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 85.44% |
| Values | Daily Returns |
Formuepleje Mix Medium vs. Dataproces Group AS
Performance |
| Timeline |
| Formuepleje Mix Medium |
| Dataproces Group |
Formuepleje Mix and Dataproces Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Formuepleje Mix and Dataproces Group
The main advantage of trading using opposite Formuepleje Mix and Dataproces Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Formuepleje Mix position performs unexpectedly, Dataproces Group 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 Dataproces Group will offset losses from the drop in Dataproces Group's long position.| Formuepleje Mix vs. Novo Nordisk AS | Formuepleje Mix vs. Nordea Bank Abp | Formuepleje Mix vs. DSV Panalpina AS | Formuepleje Mix vs. AP Mller |
| Dataproces Group vs. GN Store Nord | Dataproces Group vs. Ambu AS | Dataproces Group vs. ROCKWOOL International AS | Dataproces Group vs. Genmab 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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