Correlation Between Maj Invest and Nordfyns Bank
Can any of the company-specific risk be diversified away by investing in both Maj Invest and Nordfyns 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 Maj Invest and Nordfyns Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maj Invest and Nordfyns Bank AS, you can compare the effects of market volatilities on Maj Invest and Nordfyns 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 Maj Invest with a short position of Nordfyns Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maj Invest and Nordfyns Bank.
Diversification Opportunities for Maj Invest and Nordfyns Bank
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Maj and Nordfyns is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Maj Invest and Nordfyns Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordfyns Bank AS and Maj Invest 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 Maj Invest are associated (or correlated) with Nordfyns Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordfyns Bank AS has no effect on the direction of Maj Invest i.e., Maj Invest and Nordfyns Bank go up and down completely randomly.
Pair Corralation between Maj Invest and Nordfyns Bank
Assuming the 90 days trading horizon Maj Invest is expected to generate 0.24 times more return on investment than Nordfyns Bank. However, Maj Invest is 4.25 times less risky than Nordfyns Bank. It trades about 0.1 of its potential returns per unit of risk. Nordfyns Bank AS is currently generating about -0.36 per unit of risk. If you would invest 9,987 in Maj Invest on August 24, 2024 and sell it today you would earn a total of 39.00 from holding Maj Invest or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maj Invest vs. Nordfyns Bank AS
Performance |
| Timeline |
| Maj Invest |
| Nordfyns Bank AS |
Maj Invest and Nordfyns Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maj Invest and Nordfyns Bank
The main advantage of trading using opposite Maj Invest and Nordfyns Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maj Invest position performs unexpectedly, Nordfyns 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 Nordfyns Bank will offset losses from the drop in Nordfyns Bank's long position.| Maj Invest vs. Maj Invest | Maj Invest vs. Maj Invest Value | Maj Invest vs. Maj Invest Emerging | Maj Invest vs. Sparinvest Lange |
| Nordfyns Bank vs. Dataproces Group AS | Nordfyns Bank vs. cBrain AS | Nordfyns Bank vs. ALK Abell AS | Nordfyns Bank vs. ChemoMetec 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 Stocks Directory module to find actively traded stocks across global markets.
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