Correlation Between Gjensidige Forsikring and Storebrand ASA
Can any of the company-specific risk be diversified away by investing in both Gjensidige Forsikring and Storebrand 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 Storebrand 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 Storebrand ASA, you can compare the effects of market volatilities on Gjensidige Forsikring and Storebrand 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 Storebrand ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gjensidige Forsikring and Storebrand ASA.
Diversification Opportunities for Gjensidige Forsikring and Storebrand ASA
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gjensidige and Storebrand is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Gjensidige Forsikring ASA and Storebrand ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Storebrand 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 Storebrand ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Storebrand ASA has no effect on the direction of Gjensidige Forsikring i.e., Gjensidige Forsikring and Storebrand ASA go up and down completely randomly.
Pair Corralation between Gjensidige Forsikring and Storebrand ASA
Assuming the 90 days trading horizon Gjensidige Forsikring ASA is expected to generate 0.86 times more return on investment than Storebrand ASA. However, Gjensidige Forsikring ASA is 1.16 times less risky than Storebrand ASA. It trades about -0.08 of its potential returns per unit of risk. Storebrand ASA is currently generating about -0.09 per unit of risk. If you would invest 20,240 in Gjensidige Forsikring ASA on August 28, 2024 and sell it today you would lose (440.00) from holding Gjensidige Forsikring ASA or give up 2.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gjensidige Forsikring ASA vs. Storebrand ASA
Performance |
| Timeline |
| Gjensidige Forsikring ASA |
| Storebrand ASA |
Gjensidige Forsikring and Storebrand ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gjensidige Forsikring and Storebrand ASA
The main advantage of trading using opposite Gjensidige Forsikring and Storebrand ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gjensidige Forsikring position performs unexpectedly, Storebrand 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 Storebrand ASA will offset losses from the drop in Storebrand ASA's long position.| Gjensidige Forsikring vs. DnB ASA | Gjensidige Forsikring vs. Storebrand ASA | Gjensidige Forsikring vs. Orkla ASA | Gjensidige Forsikring vs. Telenor 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |