Correlation Between Fynske Bank and Embla Medical
Can any of the company-specific risk be diversified away by investing in both Fynske Bank and Embla Medical 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 Fynske Bank and Embla Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fynske Bank AS and Embla Medical hf, you can compare the effects of market volatilities on Fynske Bank and Embla Medical 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 Fynske Bank with a short position of Embla Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fynske Bank and Embla Medical.
Diversification Opportunities for Fynske Bank and Embla Medical
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fynske and Embla is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Fynske Bank AS and Embla Medical hf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Embla Medical hf and Fynske 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 Fynske Bank AS are associated (or correlated) with Embla Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Embla Medical hf has no effect on the direction of Fynske Bank i.e., Fynske Bank and Embla Medical go up and down completely randomly.
Pair Corralation between Fynske Bank and Embla Medical
Assuming the 90 days trading horizon Fynske Bank AS is expected to under-perform the Embla Medical. But the stock apears to be less risky and, when comparing its historical volatility, Fynske Bank AS is 1.2 times less risky than Embla Medical. The stock trades about -0.04 of its potential returns per unit of risk. The Embla Medical hf is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,700 in Embla Medical hf on September 3, 2024 and sell it today you would earn a total of 790.00 from holding Embla Medical hf or generate 29.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fynske Bank AS vs. Embla Medical hf
Performance |
| Timeline |
| Fynske Bank AS |
| Embla Medical hf |
Fynske Bank and Embla Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fynske Bank and Embla Medical
The main advantage of trading using opposite Fynske Bank and Embla Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fynske Bank position performs unexpectedly, Embla Medical 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 Embla Medical will offset losses from the drop in Embla Medical's long position.| Fynske Bank vs. FLSmidth Co | Fynske Bank vs. Danske Bank AS | Fynske Bank vs. ISS AS | Fynske Bank vs. DSV Panalpina AS |
| Embla Medical vs. Danske Andelskassers Bank | Embla Medical vs. Ringkjoebing Landbobank AS | Embla Medical vs. Moens Bank AS | Embla Medical vs. Laan Spar Bank |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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