Correlation Between Jaeren Sparebank and Xplora Technologies
Can any of the company-specific risk be diversified away by investing in both Jaeren Sparebank and Xplora Technologies 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 Xplora Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jaeren Sparebank and Xplora Technologies As, you can compare the effects of market volatilities on Jaeren Sparebank and Xplora Technologies 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 Xplora Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jaeren Sparebank and Xplora Technologies.
Diversification Opportunities for Jaeren Sparebank and Xplora Technologies
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jaeren and Xplora is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Jaeren Sparebank and Xplora Technologies As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xplora Technologies 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 Xplora Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xplora Technologies has no effect on the direction of Jaeren Sparebank i.e., Jaeren Sparebank and Xplora Technologies go up and down completely randomly.
Pair Corralation between Jaeren Sparebank and Xplora Technologies
Assuming the 90 days trading horizon Jaeren Sparebank is expected to under-perform the Xplora Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Jaeren Sparebank is 3.01 times less risky than Xplora Technologies. The stock trades about -0.08 of its potential returns per unit of risk. The Xplora Technologies As is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 2,470 in Xplora Technologies As on August 29, 2024 and sell it today you would earn a total of 490.00 from holding Xplora Technologies As or generate 19.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jaeren Sparebank vs. Xplora Technologies As
Performance |
| Timeline |
| Jaeren Sparebank |
| Xplora Technologies |
Jaeren Sparebank and Xplora Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jaeren Sparebank and Xplora Technologies
The main advantage of trading using opposite Jaeren Sparebank and Xplora Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jaeren Sparebank position performs unexpectedly, Xplora Technologies 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 Xplora Technologies will offset losses from the drop in Xplora Technologies' long position.| Jaeren Sparebank vs. DnB ASA | Jaeren Sparebank vs. Sparebank 1 SR | Jaeren Sparebank vs. Sparebank 1 SMN | Jaeren Sparebank vs. Sparebank 1 Ostfold |
| Xplora Technologies vs. Nordic Unmanned As | Xplora Technologies vs. Huddlestock Fintech As | Xplora Technologies vs. Elkem ASA | Xplora Technologies vs. Integrated Wind Solutions |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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