Correlation Between Kreditbanken and Silkeborg
Can any of the company-specific risk be diversified away by investing in both Kreditbanken and Silkeborg 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 Silkeborg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kreditbanken AS and Silkeborg IF Invest, you can compare the effects of market volatilities on Kreditbanken and Silkeborg 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 Silkeborg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kreditbanken and Silkeborg.
Diversification Opportunities for Kreditbanken and Silkeborg
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kreditbanken and Silkeborg is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Kreditbanken AS and Silkeborg IF Invest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silkeborg IF Invest 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 Silkeborg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silkeborg IF Invest has no effect on the direction of Kreditbanken i.e., Kreditbanken and Silkeborg go up and down completely randomly.
Pair Corralation between Kreditbanken and Silkeborg
Assuming the 90 days trading horizon Kreditbanken is expected to generate 3.3 times less return on investment than Silkeborg. But when comparing it to its historical volatility, Kreditbanken AS is 1.96 times less risky than Silkeborg. It trades about 0.04 of its potential returns per unit of risk. Silkeborg IF Invest is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,860 in Silkeborg IF Invest on October 1, 2024 and sell it today you would earn a total of 1,680 from holding Silkeborg IF Invest or generate 90.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kreditbanken AS vs. Silkeborg IF Invest
Performance |
| Timeline |
| Kreditbanken AS |
| Silkeborg IF Invest |
Kreditbanken and Silkeborg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kreditbanken and Silkeborg
The main advantage of trading using opposite Kreditbanken and Silkeborg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kreditbanken position performs unexpectedly, Silkeborg 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 Silkeborg will offset losses from the drop in Silkeborg's long position.| Kreditbanken vs. Lollands Bank | Kreditbanken vs. Groenlandsbanken AS | Kreditbanken vs. Skjern Bank AS | Kreditbanken vs. Djurslands Bank |
| Silkeborg vs. PARKEN Sport Entertainment | Silkeborg vs. Aalborg Boldspilklub AS | Silkeborg vs. Broendbyernes IF Fodbold | Silkeborg vs. Strategic Investments 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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