Correlation Between Nordea Bank and Green Landscaping
Can any of the company-specific risk be diversified away by investing in both Nordea Bank and Green Landscaping 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 Green Landscaping 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 Green Landscaping Group, you can compare the effects of market volatilities on Nordea Bank and Green Landscaping 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 Green Landscaping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordea Bank and Green Landscaping.
Diversification Opportunities for Nordea Bank and Green Landscaping
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordea and Green is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Nordea Bank Abp and Green Landscaping Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Landscaping 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 Green Landscaping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Landscaping has no effect on the direction of Nordea Bank i.e., Nordea Bank and Green Landscaping go up and down completely randomly.
Pair Corralation between Nordea Bank and Green Landscaping
Assuming the 90 days trading horizon Nordea Bank is expected to generate 1.19 times less return on investment than Green Landscaping. But when comparing it to its historical volatility, Nordea Bank Abp is 1.76 times less risky than Green Landscaping. It trades about 0.04 of its potential returns per unit of risk. Green Landscaping Group is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 5,920 in Green Landscaping Group on August 31, 2024 and sell it today you would earn a total of 1,110 from holding Green Landscaping Group or generate 18.75% 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. Green Landscaping Group
Performance |
| Timeline |
| Nordea Bank Abp |
| Green Landscaping |
Nordea Bank and Green Landscaping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordea Bank and Green Landscaping
The main advantage of trading using opposite Nordea Bank and Green Landscaping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordea Bank position performs unexpectedly, Green Landscaping 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 Green Landscaping will offset losses from the drop in Green Landscaping's long position.| Nordea Bank vs. Svenska Handelsbanken AB | Nordea Bank vs. Telia Company AB | Nordea Bank vs. Tele2 AB | Nordea Bank vs. H M Hennes |
| Green Landscaping vs. Instalco Intressenter AB | Green Landscaping vs. Volati AB | Green Landscaping vs. Fasadgruppen Group AB | Green Landscaping vs. Sdiptech 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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets |