Correlation Between Nordea Bank and Harboes Bryggeri
Can any of the company-specific risk be diversified away by investing in both Nordea Bank and Harboes Bryggeri 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 Nordea Bank and Harboes Bryggeri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordea Bank Abp and Harboes Bryggeri AS, you can compare the effects of market volatilities on Nordea Bank and Harboes Bryggeri 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 Nordea Bank with a short position of Harboes Bryggeri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordea Bank and Harboes Bryggeri.
Diversification Opportunities for Nordea Bank and Harboes Bryggeri
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordea and Harboes is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Nordea Bank Abp and Harboes Bryggeri AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harboes Bryggeri and Nordea 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 Nordea Bank Abp are associated (or correlated) with Harboes Bryggeri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harboes Bryggeri has no effect on the direction of Nordea Bank i.e., Nordea Bank and Harboes Bryggeri go up and down completely randomly.
Pair Corralation between Nordea Bank and Harboes Bryggeri
Assuming the 90 days trading horizon Nordea Bank is expected to generate 14.2 times less return on investment than Harboes Bryggeri. But when comparing it to its historical volatility, Nordea Bank Abp is 2.75 times less risky than Harboes Bryggeri. It trades about 0.02 of its potential returns per unit of risk. Harboes Bryggeri AS is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 6,200 in Harboes Bryggeri AS on September 1, 2024 and sell it today you would earn a total of 11,050 from holding Harboes Bryggeri AS or generate 178.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.63% |
| Values | Daily Returns |
Nordea Bank Abp vs. Harboes Bryggeri AS
Performance |
| Timeline |
| Nordea Bank Abp |
| Harboes Bryggeri |
Nordea Bank and Harboes Bryggeri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordea Bank and Harboes Bryggeri
The main advantage of trading using opposite Nordea Bank and Harboes Bryggeri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordea Bank position performs unexpectedly, Harboes Bryggeri 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 Harboes Bryggeri will offset losses from the drop in Harboes Bryggeri's long position.| Nordea Bank vs. Jyske Bank AS | Nordea Bank vs. Tryg AS | Nordea Bank vs. Danske Bank AS | Nordea Bank vs. ISS AS |
| Harboes Bryggeri vs. Royal Unibrew AS | Harboes Bryggeri vs. Matas AS | Harboes Bryggeri vs. Nnit AS | Harboes Bryggeri vs. DFDS 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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