Correlation Between Nidaros Sparebank and Teco 2030
Can any of the company-specific risk be diversified away by investing in both Nidaros Sparebank and Teco 2030 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 Nidaros Sparebank and Teco 2030 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nidaros Sparebank and Teco 2030 Asa, you can compare the effects of market volatilities on Nidaros Sparebank and Teco 2030 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 Nidaros Sparebank with a short position of Teco 2030. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nidaros Sparebank and Teco 2030.
Diversification Opportunities for Nidaros Sparebank and Teco 2030
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nidaros and Teco is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Nidaros Sparebank and Teco 2030 Asa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teco 2030 Asa and Nidaros Sparebank 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 Nidaros Sparebank are associated (or correlated) with Teco 2030. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teco 2030 Asa has no effect on the direction of Nidaros Sparebank i.e., Nidaros Sparebank and Teco 2030 go up and down completely randomly.
Pair Corralation between Nidaros Sparebank and Teco 2030
Assuming the 90 days trading horizon Nidaros Sparebank is expected to generate 0.01 times more return on investment than Teco 2030. However, Nidaros Sparebank is 73.11 times less risky than Teco 2030. It trades about -0.25 of its potential returns per unit of risk. Teco 2030 Asa is currently generating about -0.22 per unit of risk. If you would invest 10,100 in Nidaros Sparebank on September 3, 2024 and sell it today you would lose (100.00) from holding Nidaros Sparebank or give up 0.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nidaros Sparebank vs. Teco 2030 Asa
Performance |
| Timeline |
| Nidaros Sparebank |
| Teco 2030 Asa |
Nidaros Sparebank and Teco 2030 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nidaros Sparebank and Teco 2030
The main advantage of trading using opposite Nidaros Sparebank and Teco 2030 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nidaros Sparebank position performs unexpectedly, Teco 2030 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 Teco 2030 will offset losses from the drop in Teco 2030's long position.| Nidaros Sparebank vs. DnB ASA | Nidaros Sparebank vs. Sparebank 1 SR | Nidaros Sparebank vs. Sparebank 1 SMN | Nidaros Sparebank vs. Sparebanken Mre |
| Teco 2030 vs. Shelf Drilling | Teco 2030 vs. Sea1 Offshore | Teco 2030 vs. Nordic Technology Group | Teco 2030 vs. NorAm Drilling 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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