Correlation Between Gyldendal ASA and Borgestad
Can any of the company-specific risk be diversified away by investing in both Gyldendal ASA and Borgestad 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 Gyldendal ASA and Borgestad into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gyldendal ASA and Borgestad A, you can compare the effects of market volatilities on Gyldendal ASA and Borgestad 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 Gyldendal ASA with a short position of Borgestad. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gyldendal ASA and Borgestad.
Diversification Opportunities for Gyldendal ASA and Borgestad
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Gyldendal and Borgestad is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Gyldendal ASA and Borgestad A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Borgestad A and Gyldendal ASA 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 Gyldendal ASA are associated (or correlated) with Borgestad. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Borgestad A has no effect on the direction of Gyldendal ASA i.e., Gyldendal ASA and Borgestad go up and down completely randomly.
Pair Corralation between Gyldendal ASA and Borgestad
Assuming the 90 days trading horizon Gyldendal ASA is expected to under-perform the Borgestad. But the stock apears to be less risky and, when comparing its historical volatility, Gyldendal ASA is 1.19 times less risky than Borgestad. The stock trades about -0.03 of its potential returns per unit of risk. The Borgestad A is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,200 in Borgestad A on November 3, 2024 and sell it today you would earn a total of 572.00 from holding Borgestad A or generate 47.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Gyldendal ASA vs. Borgestad A
Performance |
| Timeline |
| Gyldendal ASA |
| Borgestad A |
Gyldendal ASA and Borgestad Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gyldendal ASA and Borgestad
The main advantage of trading using opposite Gyldendal ASA and Borgestad positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gyldendal ASA position performs unexpectedly, Borgestad 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 Borgestad will offset losses from the drop in Borgestad's long position.| Gyldendal ASA vs. Arendals Fossekompani ASA | Gyldendal ASA vs. Byggma | Gyldendal ASA vs. AF Gruppen ASA | Gyldendal ASA vs. Medistim ASA |
| Borgestad vs. Goodtech | Borgestad vs. Havila Shipping ASA | Borgestad vs. Eidesvik Offshore ASA | Borgestad vs. Byggma |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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