Correlation Between Kreditbanken and Aalborg Boldspilklub
Can any of the company-specific risk be diversified away by investing in both Kreditbanken and Aalborg Boldspilklub 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 Kreditbanken and Aalborg Boldspilklub into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kreditbanken AS and Aalborg Boldspilklub AS, you can compare the effects of market volatilities on Kreditbanken and Aalborg Boldspilklub 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 Kreditbanken with a short position of Aalborg Boldspilklub. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kreditbanken and Aalborg Boldspilklub.
Diversification Opportunities for Kreditbanken and Aalborg Boldspilklub
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kreditbanken and Aalborg is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Kreditbanken AS and Aalborg Boldspilklub AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aalborg Boldspilklub and Kreditbanken 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 Kreditbanken AS are associated (or correlated) with Aalborg Boldspilklub. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aalborg Boldspilklub has no effect on the direction of Kreditbanken i.e., Kreditbanken and Aalborg Boldspilklub go up and down completely randomly.
Pair Corralation between Kreditbanken and Aalborg Boldspilklub
Assuming the 90 days trading horizon Kreditbanken AS is expected to generate 0.29 times more return on investment than Aalborg Boldspilklub. However, Kreditbanken AS is 3.5 times less risky than Aalborg Boldspilklub. It trades about 0.08 of its potential returns per unit of risk. Aalborg Boldspilklub AS is currently generating about -0.11 per unit of risk. If you would invest 498,000 in Kreditbanken AS on September 22, 2024 and sell it today you would earn a total of 7,000 from holding Kreditbanken AS or generate 1.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kreditbanken AS vs. Aalborg Boldspilklub AS
Performance |
| Timeline |
| Kreditbanken AS |
| Aalborg Boldspilklub |
Kreditbanken and Aalborg Boldspilklub Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kreditbanken and Aalborg Boldspilklub
The main advantage of trading using opposite Kreditbanken and Aalborg Boldspilklub positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kreditbanken position performs unexpectedly, Aalborg Boldspilklub 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 Aalborg Boldspilklub will offset losses from the drop in Aalborg Boldspilklub's long position.| Kreditbanken vs. Lollands Bank | Kreditbanken vs. Groenlandsbanken AS | Kreditbanken vs. Skjern Bank AS | Kreditbanken vs. Djurslands Bank |
| Aalborg Boldspilklub vs. Broendbyernes IF Fodbold | Aalborg Boldspilklub vs. Bang Olufsen | Aalborg Boldspilklub vs. Matas AS | Aalborg Boldspilklub vs. NKT AS |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |