Correlation Between Investin Optimal and PARKEN Sport
Can any of the company-specific risk be diversified away by investing in both Investin Optimal 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 Investin Optimal and PARKEN Sport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investin Optimal Stabil and PARKEN Sport Entertainment, you can compare the effects of market volatilities on Investin Optimal 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 Investin Optimal with a short position of PARKEN Sport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investin Optimal and PARKEN Sport.
Diversification Opportunities for Investin Optimal and PARKEN Sport
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Investin and PARKEN is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Investin Optimal Stabil 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 Investin Optimal 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 Investin Optimal Stabil 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 Investin Optimal i.e., Investin Optimal and PARKEN Sport go up and down completely randomly.
Pair Corralation between Investin Optimal and PARKEN Sport
Assuming the 90 days trading horizon Investin Optimal Stabil is expected to under-perform the PARKEN Sport. But the stock apears to be less risky and, when comparing its historical volatility, Investin Optimal Stabil is 9.13 times less risky than PARKEN Sport. The stock trades about -0.03 of its potential returns per unit of risk. The PARKEN Sport Entertainment is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 12,100 in PARKEN Sport Entertainment on September 23, 2024 and sell it today you would earn a total of 300.00 from holding PARKEN Sport Entertainment or generate 2.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Investin Optimal Stabil vs. PARKEN Sport Entertainment
Performance |
| Timeline |
| Investin Optimal Stabil |
| PARKEN Sport Enterta |
Investin Optimal and PARKEN Sport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Investin Optimal and PARKEN Sport
The main advantage of trading using opposite Investin Optimal and PARKEN Sport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investin Optimal 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.| Investin Optimal vs. PARKEN Sport Entertainment | Investin Optimal vs. Strategic Investments AS | Investin Optimal vs. Moens Bank AS | Investin Optimal vs. Sydbank AS |
| PARKEN Sport vs. Broendbyernes IF Fodbold | PARKEN Sport vs. Matas AS | PARKEN Sport vs. NKT AS | PARKEN Sport vs. Jyske Bank 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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