Correlation Between Helgeland Sparebank and Skue Sparebank
Can any of the company-specific risk be diversified away by investing in both Helgeland Sparebank 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 Helgeland Sparebank and Skue Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Helgeland Sparebank and Skue Sparebank, you can compare the effects of market volatilities on Helgeland Sparebank 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 Helgeland Sparebank with a short position of Skue Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Helgeland Sparebank and Skue Sparebank.
Diversification Opportunities for Helgeland Sparebank and Skue Sparebank
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Helgeland and Skue is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Helgeland Sparebank and Skue Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skue Sparebank 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 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 Helgeland Sparebank i.e., Helgeland Sparebank and Skue Sparebank go up and down completely randomly.
Pair Corralation between Helgeland Sparebank and Skue Sparebank
Assuming the 90 days trading horizon Helgeland Sparebank is expected to generate 2.52 times less return on investment than Skue Sparebank. In addition to that, Helgeland Sparebank is 1.87 times more volatile than Skue Sparebank. It trades about 0.14 of its total potential returns per unit of risk. Skue Sparebank is currently generating about 0.64 per unit of volatility. If you would invest 30,000 in Skue Sparebank on November 27, 2024 and sell it today you would earn a total of 5,060 from holding Skue Sparebank or generate 16.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Helgeland Sparebank vs. Skue Sparebank
Performance |
| Timeline |
| Helgeland Sparebank |
| Skue Sparebank |
Helgeland Sparebank and Skue Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Helgeland Sparebank and Skue Sparebank
The main advantage of trading using opposite Helgeland Sparebank and Skue Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Helgeland Sparebank 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.| Helgeland Sparebank vs. Sparebank 1 Nord Norge | Helgeland Sparebank vs. Sparebank 1 SMN | Helgeland Sparebank vs. Sparebanken Vest | Helgeland Sparebank vs. Sparebanken Mre |
| 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |