Correlation Between North Media and Moens Bank
Can any of the company-specific risk be diversified away by investing in both North Media and Moens 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 Moens 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 Moens Bank AS, you can compare the effects of market volatilities on North Media and Moens 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 Moens Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of North Media and Moens Bank.
Diversification Opportunities for North Media and Moens Bank
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between North and Moens is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding North Media AS and Moens Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moens Bank AS 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 Moens Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moens Bank AS has no effect on the direction of North Media i.e., North Media and Moens Bank go up and down completely randomly.
Pair Corralation between North Media and Moens Bank
Assuming the 90 days trading horizon North Media AS is expected to under-perform the Moens Bank. But the stock apears to be less risky and, when comparing its historical volatility, North Media AS is 1.54 times less risky than Moens Bank. The stock trades about -0.22 of its potential returns per unit of risk. The Moens Bank AS is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 23,600 in Moens Bank AS on November 28, 2024 and sell it today you would earn a total of 600.00 from holding Moens Bank AS or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
North Media AS vs. Moens Bank AS
Performance |
| Timeline |
| North Media AS |
| Moens Bank AS |
North Media and Moens Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North Media and Moens Bank
The main advantage of trading using opposite North Media and Moens Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North Media position performs unexpectedly, Moens 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 Moens Bank will offset losses from the drop in Moens 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 |
| Moens Bank vs. Skjern Bank AS | Moens Bank vs. Lollands Bank | Moens Bank vs. Nordfyns Bank AS | Moens Bank vs. Groenlandsbanken 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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