Correlation Between Jaeren Sparebank and Romerike Sparebank
Can any of the company-specific risk be diversified away by investing in both Jaeren Sparebank and Romerike Sparebank 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 Romerike Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jaeren Sparebank and Romerike Sparebank, you can compare the effects of market volatilities on Jaeren Sparebank and Romerike Sparebank 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 Romerike Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jaeren Sparebank and Romerike Sparebank.
Diversification Opportunities for Jaeren Sparebank and Romerike Sparebank
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Jaeren and Romerike is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Jaeren Sparebank and Romerike Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Romerike Sparebank 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 Romerike Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Romerike Sparebank has no effect on the direction of Jaeren Sparebank i.e., Jaeren Sparebank and Romerike Sparebank go up and down completely randomly.
Pair Corralation between Jaeren Sparebank and Romerike Sparebank
Assuming the 90 days trading horizon Jaeren Sparebank is expected to generate 1.15 times more return on investment than Romerike Sparebank. However, Jaeren Sparebank is 1.15 times more volatile than Romerike Sparebank. It trades about 0.09 of its potential returns per unit of risk. Romerike Sparebank is currently generating about 0.01 per unit of risk. If you would invest 30,005 in Jaeren Sparebank on September 3, 2024 and sell it today you would earn a total of 1,885 from holding Jaeren Sparebank or generate 6.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jaeren Sparebank vs. Romerike Sparebank
Performance |
| Timeline |
| Jaeren Sparebank |
| Romerike Sparebank |
Jaeren Sparebank and Romerike Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jaeren Sparebank and Romerike Sparebank
The main advantage of trading using opposite Jaeren Sparebank and Romerike Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jaeren Sparebank position performs unexpectedly, Romerike Sparebank 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 Romerike Sparebank will offset losses from the drop in Romerike Sparebank's long position.| Jaeren Sparebank vs. Sparebank 1 SMN | Jaeren Sparebank vs. Skue Sparebank | Jaeren Sparebank vs. Instabank ASA | Jaeren Sparebank vs. Waste Plastic Upcycling |
| Romerike Sparebank vs. Goodtech | Romerike Sparebank vs. Xplora Technologies As | Romerike Sparebank vs. Sparebank 1 SMN | Romerike Sparebank vs. Jaeren 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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