Correlation Between Nordea Bank and Flexion Mobile
Can any of the company-specific risk be diversified away by investing in both Nordea Bank and Flexion Mobile 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 Flexion Mobile 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 Flexion Mobile PLC, you can compare the effects of market volatilities on Nordea Bank and Flexion Mobile 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 Flexion Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordea Bank and Flexion Mobile.
Diversification Opportunities for Nordea Bank and Flexion Mobile
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordea and Flexion is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Nordea Bank Abp and Flexion Mobile PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flexion Mobile PLC 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 Flexion Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flexion Mobile PLC has no effect on the direction of Nordea Bank i.e., Nordea Bank and Flexion Mobile go up and down completely randomly.
Pair Corralation between Nordea Bank and Flexion Mobile
Assuming the 90 days trading horizon Nordea Bank Abp is expected to generate 0.38 times more return on investment than Flexion Mobile. However, Nordea Bank Abp is 2.64 times less risky than Flexion Mobile. It trades about 0.05 of its potential returns per unit of risk. Flexion Mobile PLC is currently generating about -0.01 per unit of risk. If you would invest 10,756 in Nordea Bank Abp on August 26, 2024 and sell it today you would earn a total of 1,474 from holding Nordea Bank Abp or generate 13.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordea Bank Abp vs. Flexion Mobile PLC
Performance |
| Timeline |
| Nordea Bank Abp |
| Flexion Mobile PLC |
Nordea Bank and Flexion Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordea Bank and Flexion Mobile
The main advantage of trading using opposite Nordea Bank and Flexion Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordea Bank position performs unexpectedly, Flexion Mobile 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 Flexion Mobile will offset losses from the drop in Flexion Mobile's long position.The idea behind Nordea Bank Abp and Flexion Mobile PLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Flexion Mobile vs. iZafe Group AB | Flexion Mobile vs. KABE Group AB | Flexion Mobile vs. IAR Systems Group | Flexion Mobile vs. Norva24 Group AB |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |