Correlation Between Lollands Bank and Dataproces Group
Can any of the company-specific risk be diversified away by investing in both Lollands Bank and Dataproces Group 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 Lollands Bank and Dataproces Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lollands Bank and Dataproces Group AS, you can compare the effects of market volatilities on Lollands Bank and Dataproces Group 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 Lollands Bank with a short position of Dataproces Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lollands Bank and Dataproces Group.
Diversification Opportunities for Lollands Bank and Dataproces Group
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lollands and Dataproces is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Lollands Bank and Dataproces Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dataproces Group and Lollands Bank 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 Lollands Bank are associated (or correlated) with Dataproces Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dataproces Group has no effect on the direction of Lollands Bank i.e., Lollands Bank and Dataproces Group go up and down completely randomly.
Pair Corralation between Lollands Bank and Dataproces Group
Assuming the 90 days trading horizon Lollands Bank is expected to generate 0.38 times more return on investment than Dataproces Group. However, Lollands Bank is 2.65 times less risky than Dataproces Group. It trades about -0.06 of its potential returns per unit of risk. Dataproces Group AS is currently generating about -0.03 per unit of risk. If you would invest 56,500 in Lollands Bank on August 28, 2024 and sell it today you would lose (1,000.00) from holding Lollands Bank or give up 1.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lollands Bank vs. Dataproces Group AS
Performance |
| Timeline |
| Lollands Bank |
| Dataproces Group |
Lollands Bank and Dataproces Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lollands Bank and Dataproces Group
The main advantage of trading using opposite Lollands Bank and Dataproces Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lollands Bank position performs unexpectedly, Dataproces Group 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 Dataproces Group will offset losses from the drop in Dataproces Group's long position.| Lollands Bank vs. Dataproces Group AS | Lollands Bank vs. cBrain AS | Lollands Bank vs. ALK Abell AS | Lollands Bank vs. ChemoMetec AS |
| Dataproces Group vs. Penneo AS | Dataproces Group vs. Bactiquant AS | Dataproces Group vs. cBrain AS | Dataproces Group vs. FOM Technologies 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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