Correlation Between Helgeland Sparebank and Nordic Mining
Can any of the company-specific risk be diversified away by investing in both Helgeland Sparebank and Nordic Mining 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 Helgeland Sparebank and Nordic Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Helgeland Sparebank and Nordic Mining ASA, you can compare the effects of market volatilities on Helgeland Sparebank and Nordic Mining 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 Helgeland Sparebank with a short position of Nordic Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Helgeland Sparebank and Nordic Mining.
Diversification Opportunities for Helgeland Sparebank and Nordic Mining
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Helgeland and Nordic is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Helgeland Sparebank and Nordic Mining ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Mining ASA and Helgeland 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 Helgeland Sparebank are associated (or correlated) with Nordic Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Mining ASA has no effect on the direction of Helgeland Sparebank i.e., Helgeland Sparebank and Nordic Mining go up and down completely randomly.
Pair Corralation between Helgeland Sparebank and Nordic Mining
Assuming the 90 days trading horizon Helgeland Sparebank is expected to generate 0.82 times more return on investment than Nordic Mining. However, Helgeland Sparebank is 1.21 times less risky than Nordic Mining. It trades about 0.36 of its potential returns per unit of risk. Nordic Mining ASA is currently generating about -0.33 per unit of risk. If you would invest 14,400 in Helgeland Sparebank on November 3, 2024 and sell it today you would earn a total of 2,300 from holding Helgeland Sparebank or generate 15.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Helgeland Sparebank vs. Nordic Mining ASA
Performance |
| Timeline |
| Helgeland Sparebank |
| Nordic Mining ASA |
Helgeland Sparebank and Nordic Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Helgeland Sparebank and Nordic Mining
The main advantage of trading using opposite Helgeland Sparebank and Nordic Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Helgeland Sparebank position performs unexpectedly, Nordic Mining 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 Nordic Mining will offset losses from the drop in Nordic Mining's long position.| Helgeland Sparebank vs. Sparebank 1 Nord Norge | Helgeland Sparebank vs. Sparebank 1 SMN | Helgeland Sparebank vs. Sparebanken Vest | Helgeland Sparebank vs. Sparebanken Mre |
| Nordic Mining vs. 5Th Planet Games | Nordic Mining vs. Cloudberry Clean Energy | Nordic Mining vs. Aurskog Sparebank | Nordic Mining vs. Nordic Semiconductor 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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