Correlation Between H Lundbeck and Tryg AS
Can any of the company-specific risk be diversified away by investing in both H Lundbeck and Tryg AS 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 H Lundbeck and Tryg AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between H Lundbeck AS and Tryg AS, you can compare the effects of market volatilities on H Lundbeck and Tryg AS 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 H Lundbeck with a short position of Tryg AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of H Lundbeck and Tryg AS.
Diversification Opportunities for H Lundbeck and Tryg AS
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HLUN-B and Tryg is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding H Lundbeck AS and Tryg AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tryg AS and H Lundbeck 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 H Lundbeck AS are associated (or correlated) with Tryg AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tryg AS has no effect on the direction of H Lundbeck i.e., H Lundbeck and Tryg AS go up and down completely randomly.
Pair Corralation between H Lundbeck and Tryg AS
Assuming the 90 days trading horizon H Lundbeck AS is expected to generate 1.5 times more return on investment than Tryg AS. However, H Lundbeck is 1.5 times more volatile than Tryg AS. It trades about 0.08 of its potential returns per unit of risk. Tryg AS is currently generating about 0.02 per unit of risk. If you would invest 2,541 in H Lundbeck AS on August 29, 2024 and sell it today you would earn a total of 1,849 from holding H Lundbeck AS or generate 72.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
H Lundbeck AS vs. Tryg AS
Performance |
| Timeline |
| H Lundbeck AS |
| Tryg AS |
H Lundbeck and Tryg AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with H Lundbeck and Tryg AS
The main advantage of trading using opposite H Lundbeck and Tryg AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if H Lundbeck position performs unexpectedly, Tryg AS 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 Tryg AS will offset losses from the drop in Tryg AS's long position.| H Lundbeck vs. H Lundbeck AS | H Lundbeck vs. GN Store Nord | H Lundbeck vs. FLSmidth Co | H Lundbeck vs. ALK Abell AS |
| Tryg AS vs. Dataproces Group AS | Tryg AS vs. cBrain AS | Tryg AS vs. ALK Abell AS | Tryg AS vs. ChemoMetec AS |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| 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 | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |