Correlation Between Jaeren Sparebank and Nordic Aqua
Can any of the company-specific risk be diversified away by investing in both Jaeren Sparebank and Nordic Aqua 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 Jaeren Sparebank and Nordic Aqua into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jaeren Sparebank and Nordic Aqua Partners, you can compare the effects of market volatilities on Jaeren Sparebank and Nordic Aqua 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 Jaeren Sparebank with a short position of Nordic Aqua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jaeren Sparebank and Nordic Aqua.
Diversification Opportunities for Jaeren Sparebank and Nordic Aqua
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jaeren and Nordic is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Jaeren Sparebank and Nordic Aqua Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Aqua Partners and Jaeren 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 Jaeren Sparebank are associated (or correlated) with Nordic Aqua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Aqua Partners has no effect on the direction of Jaeren Sparebank i.e., Jaeren Sparebank and Nordic Aqua go up and down completely randomly.
Pair Corralation between Jaeren Sparebank and Nordic Aqua
Assuming the 90 days trading horizon Jaeren Sparebank is expected to generate 0.41 times more return on investment than Nordic Aqua. However, Jaeren Sparebank is 2.42 times less risky than Nordic Aqua. It trades about 0.0 of its potential returns per unit of risk. Nordic Aqua Partners is currently generating about -0.13 per unit of risk. If you would invest 31,895 in Jaeren Sparebank on September 1, 2024 and sell it today you would lose (5.00) from holding Jaeren Sparebank or give up 0.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Jaeren Sparebank vs. Nordic Aqua Partners
Performance |
| Timeline |
| Jaeren Sparebank |
| Nordic Aqua Partners |
Jaeren Sparebank and Nordic Aqua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jaeren Sparebank and Nordic Aqua
The main advantage of trading using opposite Jaeren Sparebank and Nordic Aqua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jaeren Sparebank position performs unexpectedly, Nordic Aqua 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 Aqua will offset losses from the drop in Nordic Aqua's long position.| Jaeren Sparebank vs. Napatech AS | Jaeren Sparebank vs. Lery Seafood Group | Jaeren Sparebank vs. Arcticzymes Technologies ASA | Jaeren Sparebank vs. Kraft Bank Asa |
| Nordic Aqua vs. Andfjord Salmon AS | Nordic Aqua vs. Elkem ASA | Nordic Aqua vs. Integrated Wind Solutions | Nordic Aqua vs. Vow 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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