Correlation Between Fynske Bank and Freetrailer Group
Can any of the company-specific risk be diversified away by investing in both Fynske Bank and Freetrailer 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 Fynske Bank and Freetrailer Group 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 Freetrailer Group AS, you can compare the effects of market volatilities on Fynske Bank and Freetrailer 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 Fynske Bank with a short position of Freetrailer Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fynske Bank and Freetrailer Group.
Diversification Opportunities for Fynske Bank and Freetrailer Group
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fynske and Freetrailer is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Fynske Bank AS and Freetrailer Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freetrailer Group 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 Freetrailer Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freetrailer Group has no effect on the direction of Fynske Bank i.e., Fynske Bank and Freetrailer Group go up and down completely randomly.
Pair Corralation between Fynske Bank and Freetrailer Group
Assuming the 90 days trading horizon Fynske Bank AS is expected to under-perform the Freetrailer Group. But the stock apears to be less risky and, when comparing its historical volatility, Fynske Bank AS is 1.34 times less risky than Freetrailer Group. The stock trades about -0.03 of its potential returns per unit of risk. The Freetrailer Group AS is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 4,550 in Freetrailer Group AS on August 31, 2024 and sell it today you would earn a total of 300.00 from holding Freetrailer Group AS or generate 6.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fynske Bank AS vs. Freetrailer Group AS
Performance |
| Timeline |
| Fynske Bank AS |
| Freetrailer Group |
Fynske Bank and Freetrailer Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fynske Bank and Freetrailer Group
The main advantage of trading using opposite Fynske Bank and Freetrailer Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fynske Bank position performs unexpectedly, Freetrailer 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 Freetrailer Group will offset losses from the drop in Freetrailer Group's long position.| Fynske Bank vs. Sydbank AS | Fynske Bank vs. Jyske Bank AS | Fynske Bank vs. Alm Brand | Fynske Bank vs. Nordea Bank Abp |
| Freetrailer Group vs. PARKEN Sport Entertainment | Freetrailer Group vs. Spar Nord Bank | Freetrailer Group vs. Fynske Bank AS | Freetrailer Group vs. NTG Nordic Transport |
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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