Correlation Between Jeudan and EgnsINVEST Ejendomme
Can any of the company-specific risk be diversified away by investing in both Jeudan and EgnsINVEST Ejendomme 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 Jeudan and EgnsINVEST Ejendomme into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeudan and EgnsINVEST Ejendomme Tyskland, you can compare the effects of market volatilities on Jeudan and EgnsINVEST Ejendomme 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 Jeudan with a short position of EgnsINVEST Ejendomme. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeudan and EgnsINVEST Ejendomme.
Diversification Opportunities for Jeudan and EgnsINVEST Ejendomme
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jeudan and EgnsINVEST is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Jeudan and EgnsINVEST Ejendomme Tyskland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EgnsINVEST Ejendomme and Jeudan 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 Jeudan are associated (or correlated) with EgnsINVEST Ejendomme. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EgnsINVEST Ejendomme has no effect on the direction of Jeudan i.e., Jeudan and EgnsINVEST Ejendomme go up and down completely randomly.
Pair Corralation between Jeudan and EgnsINVEST Ejendomme
Assuming the 90 days trading horizon Jeudan is expected to generate 1.17 times more return on investment than EgnsINVEST Ejendomme. However, Jeudan is 1.17 times more volatile than EgnsINVEST Ejendomme Tyskland. It trades about -0.05 of its potential returns per unit of risk. EgnsINVEST Ejendomme Tyskland is currently generating about -0.07 per unit of risk. If you would invest 21,600 in Jeudan on September 12, 2024 and sell it today you would lose (1,200) from holding Jeudan or give up 5.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Jeudan vs. EgnsINVEST Ejendomme Tyskland
Performance |
| Timeline |
| Jeudan |
| EgnsINVEST Ejendomme |
Jeudan and EgnsINVEST Ejendomme Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeudan and EgnsINVEST Ejendomme
The main advantage of trading using opposite Jeudan and EgnsINVEST Ejendomme positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeudan position performs unexpectedly, EgnsINVEST Ejendomme 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 EgnsINVEST Ejendomme will offset losses from the drop in EgnsINVEST Ejendomme's long position.The idea behind Jeudan and EgnsINVEST Ejendomme Tyskland pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| EgnsINVEST Ejendomme vs. Vestjysk Bank AS | EgnsINVEST Ejendomme vs. PARKEN Sport Entertainment | EgnsINVEST Ejendomme vs. Strategic Investments AS | EgnsINVEST Ejendomme vs. BankIn Bredygt Klimaakt |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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