Correlation Between Gjensidige Forsikring and Entra ASA
Can any of the company-specific risk be diversified away by investing in both Gjensidige Forsikring and Entra 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 Gjensidige Forsikring and Entra ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gjensidige Forsikring ASA and Entra ASA, you can compare the effects of market volatilities on Gjensidige Forsikring and Entra 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 Gjensidige Forsikring with a short position of Entra ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gjensidige Forsikring and Entra ASA.
Diversification Opportunities for Gjensidige Forsikring and Entra ASA
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Gjensidige and Entra is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Gjensidige Forsikring ASA and Entra ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entra ASA and Gjensidige Forsikring 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 Gjensidige Forsikring ASA are associated (or correlated) with Entra ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entra ASA has no effect on the direction of Gjensidige Forsikring i.e., Gjensidige Forsikring and Entra ASA go up and down completely randomly.
Pair Corralation between Gjensidige Forsikring and Entra ASA
Assuming the 90 days trading horizon Gjensidige Forsikring ASA is expected to under-perform the Entra ASA. But the stock apears to be less risky and, when comparing its historical volatility, Gjensidige Forsikring ASA is 3.75 times less risky than Entra ASA. The stock trades about -0.15 of its potential returns per unit of risk. The Entra ASA is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 11,620 in Entra ASA on November 27, 2024 and sell it today you would lose (80.00) from holding Entra ASA or give up 0.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gjensidige Forsikring ASA vs. Entra ASA
Performance |
| Timeline |
| Gjensidige Forsikring ASA |
| Entra ASA |
Gjensidige Forsikring and Entra ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gjensidige Forsikring and Entra ASA
The main advantage of trading using opposite Gjensidige Forsikring and Entra ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gjensidige Forsikring position performs unexpectedly, Entra 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 Entra ASA will offset losses from the drop in Entra ASA's long position.| Gjensidige Forsikring vs. DnB ASA | Gjensidige Forsikring vs. Storebrand ASA | Gjensidige Forsikring vs. Orkla ASA | Gjensidige Forsikring vs. Telenor ASA |
| Entra ASA vs. Gjensidige Forsikring ASA | Entra ASA vs. Storebrand ASA | Entra ASA vs. Olav Thon Eien | Entra ASA vs. DnB 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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