Correlation Between Kreditbanken and Djurslands Bank
Can any of the company-specific risk be diversified away by investing in both Kreditbanken and Djurslands Bank 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 Djurslands Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kreditbanken AS and Djurslands Bank, you can compare the effects of market volatilities on Kreditbanken and Djurslands Bank 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 Djurslands Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kreditbanken and Djurslands Bank.
Diversification Opportunities for Kreditbanken and Djurslands Bank
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kreditbanken and Djurslands is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Kreditbanken AS and Djurslands Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Djurslands Bank 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 Djurslands Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Djurslands Bank has no effect on the direction of Kreditbanken i.e., Kreditbanken and Djurslands Bank go up and down completely randomly.
Pair Corralation between Kreditbanken and Djurslands Bank
Assuming the 90 days trading horizon Kreditbanken AS is expected to generate 1.39 times more return on investment than Djurslands Bank. However, Kreditbanken is 1.39 times more volatile than Djurslands Bank. It trades about 0.01 of its potential returns per unit of risk. Djurslands Bank is currently generating about -0.04 per unit of risk. If you would invest 505,000 in Kreditbanken AS on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Kreditbanken AS or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Kreditbanken AS vs. Djurslands Bank
Performance |
| Timeline |
| Kreditbanken AS |
| Djurslands Bank |
Kreditbanken and Djurslands Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kreditbanken and Djurslands Bank
The main advantage of trading using opposite Kreditbanken and Djurslands Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kreditbanken position performs unexpectedly, Djurslands Bank 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 Djurslands Bank will offset losses from the drop in Djurslands Bank's long position.| Kreditbanken vs. Lollands Bank | Kreditbanken vs. Groenlandsbanken AS | Kreditbanken vs. Skjern Bank AS | Kreditbanken vs. Djurslands Bank |
| Djurslands Bank vs. Sydbank AS | Djurslands Bank vs. Jyske Bank AS | Djurslands Bank vs. Alm Brand | Djurslands Bank vs. Nordea Bank Abp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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