Correlation Between Nordea Bank and Investin Optimal
Can any of the company-specific risk be diversified away by investing in both Nordea Bank and Investin Optimal 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 Investin Optimal 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 Investin Optimal Stabil, you can compare the effects of market volatilities on Nordea Bank and Investin Optimal 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 Investin Optimal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordea Bank and Investin Optimal.
Diversification Opportunities for Nordea Bank and Investin Optimal
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nordea and Investin is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Nordea Bank Abp and Investin Optimal Stabil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investin Optimal Stabil 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 Investin Optimal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investin Optimal Stabil has no effect on the direction of Nordea Bank i.e., Nordea Bank and Investin Optimal go up and down completely randomly.
Pair Corralation between Nordea Bank and Investin Optimal
Assuming the 90 days trading horizon Nordea Bank Abp is expected to under-perform the Investin Optimal. In addition to that, Nordea Bank is 5.96 times more volatile than Investin Optimal Stabil. It trades about -0.14 of its total potential returns per unit of risk. Investin Optimal Stabil is currently generating about -0.05 per unit of volatility. If you would invest 14,858 in Investin Optimal Stabil on September 25, 2024 and sell it today you would lose (30.00) from holding Investin Optimal Stabil or give up 0.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Nordea Bank Abp vs. Investin Optimal Stabil
Performance |
| Timeline |
| Nordea Bank Abp |
| Investin Optimal Stabil |
Nordea Bank and Investin Optimal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordea Bank and Investin Optimal
The main advantage of trading using opposite Nordea Bank and Investin Optimal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordea Bank position performs unexpectedly, Investin Optimal 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 Investin Optimal will offset losses from the drop in Investin Optimal'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 |
| Investin Optimal vs. Novo Nordisk AS | Investin Optimal vs. Nordea Bank Abp | Investin Optimal vs. DSV Panalpina AS | Investin Optimal vs. AP Mller |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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