Correlation Between Goodtech and Skue Sparebank
Can any of the company-specific risk be diversified away by investing in both Goodtech and Skue Sparebank 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 Goodtech and Skue Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goodtech and Skue Sparebank, you can compare the effects of market volatilities on Goodtech and Skue Sparebank 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 Goodtech with a short position of Skue Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goodtech and Skue Sparebank.
Diversification Opportunities for Goodtech and Skue Sparebank
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Goodtech and Skue is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Goodtech and Skue Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skue Sparebank and Goodtech 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 Goodtech are associated (or correlated) with Skue Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skue Sparebank has no effect on the direction of Goodtech i.e., Goodtech and Skue Sparebank go up and down completely randomly.
Pair Corralation between Goodtech and Skue Sparebank
Assuming the 90 days trading horizon Goodtech is expected to under-perform the Skue Sparebank. In addition to that, Goodtech is 1.38 times more volatile than Skue Sparebank. It trades about -0.23 of its total potential returns per unit of risk. Skue Sparebank is currently generating about 0.01 per unit of volatility. If you would invest 25,300 in Skue Sparebank on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Skue Sparebank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goodtech vs. Skue Sparebank
Performance |
| Timeline |
| Goodtech |
| Skue Sparebank |
Goodtech and Skue Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goodtech and Skue Sparebank
The main advantage of trading using opposite Goodtech and Skue Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goodtech position performs unexpectedly, Skue Sparebank 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 Skue Sparebank will offset losses from the drop in Skue Sparebank's long position.| Goodtech vs. Eidesvik Offshore ASA | Goodtech vs. Kitron ASA | Goodtech vs. Havila Shipping ASA | Goodtech vs. Elkem ASA |
| Skue Sparebank vs. Melhus Sparebank | Skue Sparebank vs. Sparebanken Ost | Skue Sparebank vs. Sparebanken Sor |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |