Correlation Between Grong Sparebank and Alternus Energy
Can any of the company-specific risk be diversified away by investing in both Grong Sparebank and Alternus Energy 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 Grong Sparebank and Alternus Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grong Sparebank and Alternus Energy Group, you can compare the effects of market volatilities on Grong Sparebank and Alternus Energy 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 Grong Sparebank with a short position of Alternus Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grong Sparebank and Alternus Energy.
Diversification Opportunities for Grong Sparebank and Alternus Energy
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grong and Alternus is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Grong Sparebank and Alternus Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alternus Energy Group and Grong Sparebank 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 Grong Sparebank are associated (or correlated) with Alternus Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alternus Energy Group has no effect on the direction of Grong Sparebank i.e., Grong Sparebank and Alternus Energy go up and down completely randomly.
Pair Corralation between Grong Sparebank and Alternus Energy
Assuming the 90 days trading horizon Grong Sparebank is expected to generate 0.09 times more return on investment than Alternus Energy. However, Grong Sparebank is 10.85 times less risky than Alternus Energy. It trades about 0.07 of its potential returns per unit of risk. Alternus Energy Group is currently generating about -0.1 per unit of risk. If you would invest 14,596 in Grong Sparebank on September 13, 2024 and sell it today you would earn a total of 572.00 from holding Grong Sparebank or generate 3.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grong Sparebank vs. Alternus Energy Group
Performance |
| Timeline |
| Grong Sparebank |
| Alternus Energy Group |
Grong Sparebank and Alternus Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grong Sparebank and Alternus Energy
The main advantage of trading using opposite Grong Sparebank and Alternus Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grong Sparebank position performs unexpectedly, Alternus Energy 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 Alternus Energy will offset losses from the drop in Alternus Energy's long position.| Grong Sparebank vs. DnB ASA | Grong Sparebank vs. Sparebank 1 SMN | Grong Sparebank vs. Sparebanken Mre | Grong Sparebank vs. Sparebank 1 Ostfold |
| Alternus Energy vs. Grong Sparebank | Alternus Energy vs. Shelf Drilling | Alternus Energy vs. Aasen Sparebank | Alternus Energy vs. Instabank 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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