Correlation Between Nordea Bank and Jyske Bank
Can any of the company-specific risk be diversified away by investing in both Nordea Bank and Jyske 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 Nordea Bank and Jyske Bank 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 Jyske Bank AS, you can compare the effects of market volatilities on Nordea Bank and Jyske 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 Nordea Bank with a short position of Jyske Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordea Bank and Jyske Bank.
Diversification Opportunities for Nordea Bank and Jyske Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nordea and Jyske is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nordea Bank Abp and Jyske Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jyske Bank AS 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 Jyske Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jyske Bank AS has no effect on the direction of Nordea Bank i.e., Nordea Bank and Jyske Bank go up and down completely randomly.
Pair Corralation between Nordea Bank and Jyske Bank
Assuming the 90 days horizon Nordea Bank is expected to generate 3.02 times less return on investment than Jyske Bank. But when comparing it to its historical volatility, Nordea Bank Abp is 1.04 times less risky than Jyske Bank. It trades about 0.02 of its potential returns per unit of risk. Jyske Bank AS is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 968.00 in Jyske Bank AS on November 2, 2024 and sell it today you would earn a total of 461.00 from holding Jyske Bank AS or generate 47.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Nordea Bank Abp vs. Jyske Bank AS
Performance |
| Timeline |
| Nordea Bank Abp |
| Jyske Bank AS |
Nordea Bank and Jyske Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordea Bank and Jyske Bank
The main advantage of trading using opposite Nordea Bank and Jyske Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordea Bank position performs unexpectedly, Jyske 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 Jyske Bank will offset losses from the drop in Jyske Bank's long position.| Nordea Bank vs. United Overseas Bank | Nordea Bank vs. KBC Groep NV | Nordea Bank vs. Bank Mandiri Persero | Nordea Bank vs. Overseas Chinese Banking |
| Jyske Bank vs. Baraboo Bancorporation | Jyske Bank vs. Schweizerische Nationalbank | Jyske Bank vs. Danske Bank AS | Jyske Bank vs. Absa Group Limited |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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