Correlation Between Hvidbjerg Bank and PARKEN Sport
Can any of the company-specific risk be diversified away by investing in both Hvidbjerg Bank and PARKEN Sport 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 Hvidbjerg Bank and PARKEN Sport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hvidbjerg Bank and PARKEN Sport Entertainment, you can compare the effects of market volatilities on Hvidbjerg Bank and PARKEN Sport 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 Hvidbjerg Bank with a short position of PARKEN Sport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hvidbjerg Bank and PARKEN Sport.
Diversification Opportunities for Hvidbjerg Bank and PARKEN Sport
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hvidbjerg and PARKEN is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Hvidbjerg Bank and PARKEN Sport Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PARKEN Sport Enterta and Hvidbjerg Bank 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 Hvidbjerg Bank are associated (or correlated) with PARKEN Sport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PARKEN Sport Enterta has no effect on the direction of Hvidbjerg Bank i.e., Hvidbjerg Bank and PARKEN Sport go up and down completely randomly.
Pair Corralation between Hvidbjerg Bank and PARKEN Sport
Assuming the 90 days trading horizon Hvidbjerg Bank is expected to generate 0.63 times more return on investment than PARKEN Sport. However, Hvidbjerg Bank is 1.58 times less risky than PARKEN Sport. It trades about 0.03 of its potential returns per unit of risk. PARKEN Sport Entertainment is currently generating about -0.02 per unit of risk. If you would invest 11,000 in Hvidbjerg Bank on August 29, 2024 and sell it today you would earn a total of 800.00 from holding Hvidbjerg Bank or generate 7.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.52% |
| Values | Daily Returns |
Hvidbjerg Bank vs. PARKEN Sport Entertainment
Performance |
| Timeline |
| Hvidbjerg Bank |
| PARKEN Sport Enterta |
Hvidbjerg Bank and PARKEN Sport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hvidbjerg Bank and PARKEN Sport
The main advantage of trading using opposite Hvidbjerg Bank and PARKEN Sport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hvidbjerg Bank position performs unexpectedly, PARKEN Sport 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 PARKEN Sport will offset losses from the drop in PARKEN Sport's long position.| Hvidbjerg Bank vs. Sydbank AS | Hvidbjerg Bank vs. Jyske Bank AS | Hvidbjerg Bank vs. Alm Brand | Hvidbjerg Bank vs. Nordea Bank Abp |
| PARKEN Sport vs. Broendbyernes IF Fodbold | PARKEN Sport vs. Bang Olufsen | PARKEN Sport vs. Matas AS | PARKEN Sport vs. NKT 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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