Correlation Between Nordfyns Bank and DecideAct
Can any of the company-specific risk be diversified away by investing in both Nordfyns Bank and DecideAct 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 Nordfyns Bank and DecideAct into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordfyns Bank AS and DecideAct AS, you can compare the effects of market volatilities on Nordfyns Bank and DecideAct 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 Nordfyns Bank with a short position of DecideAct. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordfyns Bank and DecideAct.
Diversification Opportunities for Nordfyns Bank and DecideAct
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nordfyns and DecideAct is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Nordfyns Bank AS and DecideAct AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DecideAct AS and Nordfyns 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 Nordfyns Bank AS are associated (or correlated) with DecideAct. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DecideAct AS has no effect on the direction of Nordfyns Bank i.e., Nordfyns Bank and DecideAct go up and down completely randomly.
Pair Corralation between Nordfyns Bank and DecideAct
Assuming the 90 days trading horizon Nordfyns Bank AS is expected to generate 0.11 times more return on investment than DecideAct. However, Nordfyns Bank AS is 9.06 times less risky than DecideAct. It trades about 0.42 of its potential returns per unit of risk. DecideAct AS is currently generating about -0.02 per unit of risk. If you would invest 33,600 in Nordfyns Bank AS on November 27, 2024 and sell it today you would earn a total of 2,200 from holding Nordfyns Bank AS or generate 6.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordfyns Bank AS vs. DecideAct AS
Performance |
| Timeline |
| Nordfyns Bank AS |
| DecideAct AS |
Nordfyns Bank and DecideAct Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordfyns Bank and DecideAct
The main advantage of trading using opposite Nordfyns Bank and DecideAct positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordfyns Bank position performs unexpectedly, DecideAct 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 DecideAct will offset losses from the drop in DecideAct's long position.| Nordfyns Bank vs. Skjern Bank AS | Nordfyns Bank vs. Lollands Bank | Nordfyns Bank vs. Djurslands Bank | Nordfyns Bank vs. Moens Bank AS |
| DecideAct vs. FOM Technologies AS | DecideAct vs. Scandinavian Medical Solutions | DecideAct vs. NTG Nordic Transport | DecideAct 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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