Correlation Between Jaeren Sparebank and Nordic Technology
Can any of the company-specific risk be diversified away by investing in both Jaeren Sparebank and Nordic Technology 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 Technology 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 Technology Group, you can compare the effects of market volatilities on Jaeren Sparebank and Nordic Technology 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 Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jaeren Sparebank and Nordic Technology.
Diversification Opportunities for Jaeren Sparebank and Nordic Technology
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jaeren and Nordic is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Jaeren Sparebank and Nordic Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Technology 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 Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Technology has no effect on the direction of Jaeren Sparebank i.e., Jaeren Sparebank and Nordic Technology go up and down completely randomly.
Pair Corralation between Jaeren Sparebank and Nordic Technology
Assuming the 90 days trading horizon Jaeren Sparebank is expected to generate 0.06 times more return on investment than Nordic Technology. However, Jaeren Sparebank is 15.8 times less risky than Nordic Technology. It trades about 0.38 of its potential returns per unit of risk. Nordic Technology Group is currently generating about -0.03 per unit of risk. If you would invest 32,685 in Jaeren Sparebank on November 5, 2024 and sell it today you would earn a total of 2,215 from holding Jaeren Sparebank or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jaeren Sparebank vs. Nordic Technology Group
Performance |
| Timeline |
| Jaeren Sparebank |
| Nordic Technology |
Jaeren Sparebank and Nordic Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jaeren Sparebank and Nordic Technology
The main advantage of trading using opposite Jaeren Sparebank and Nordic Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jaeren Sparebank position performs unexpectedly, Nordic Technology 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 Technology will offset losses from the drop in Nordic Technology's long position.| Jaeren Sparebank vs. NorAm Drilling AS | Jaeren Sparebank vs. Nidaros Sparebank | Jaeren Sparebank vs. Techstep ASA | Jaeren Sparebank vs. Instabank ASA |
| Nordic Technology vs. Clean Seas Seafood | Nordic Technology vs. Morrow Bank ASA | Nordic Technology vs. BW Offshore | Nordic Technology vs. Melhus Sparebank |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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