Correlation Between North Media and Hvidbjerg Bank
Can any of the company-specific risk be diversified away by investing in both North Media and Hvidbjerg Bank 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 North Media and Hvidbjerg Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between North Media AS and Hvidbjerg Bank, you can compare the effects of market volatilities on North Media and Hvidbjerg Bank 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 North Media with a short position of Hvidbjerg Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of North Media and Hvidbjerg Bank.
Diversification Opportunities for North Media and Hvidbjerg Bank
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between North and Hvidbjerg is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding North Media AS and Hvidbjerg Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hvidbjerg Bank and North Media 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 North Media AS are associated (or correlated) with Hvidbjerg Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hvidbjerg Bank has no effect on the direction of North Media i.e., North Media and Hvidbjerg Bank go up and down completely randomly.
Pair Corralation between North Media and Hvidbjerg Bank
Assuming the 90 days trading horizon North Media AS is expected to under-perform the Hvidbjerg Bank. In addition to that, North Media is 1.0 times more volatile than Hvidbjerg Bank. It trades about -0.29 of its total potential returns per unit of risk. Hvidbjerg Bank is currently generating about 0.14 per unit of volatility. If you would invest 11,400 in Hvidbjerg Bank on August 27, 2024 and sell it today you would earn a total of 400.00 from holding Hvidbjerg Bank or generate 3.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
North Media AS vs. Hvidbjerg Bank
Performance |
| Timeline |
| North Media AS |
| Hvidbjerg Bank |
North Media and Hvidbjerg Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North Media and Hvidbjerg Bank
The main advantage of trading using opposite North Media and Hvidbjerg Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North Media position performs unexpectedly, Hvidbjerg Bank 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 Hvidbjerg Bank will offset losses from the drop in Hvidbjerg Bank's long position.| North Media vs. Matas AS | North Media vs. cBrain AS | North Media vs. Alm Brand | North Media vs. Netcompany Group AS |
| Hvidbjerg Bank vs. Dataproces Group AS | Hvidbjerg Bank vs. cBrain AS | Hvidbjerg Bank vs. ALK Abell AS | Hvidbjerg Bank vs. ChemoMetec 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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