Correlation Between OMX Copenhagen and Sparinvest Value

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Can any of the company-specific risk be diversified away by investing in both OMX Copenhagen and Sparinvest Value 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 OMX Copenhagen and Sparinvest Value into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between OMX Copenhagen All and Sparinvest Value Bonds, you can compare the effects of market volatilities on OMX Copenhagen and Sparinvest Value 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 OMX Copenhagen with a short position of Sparinvest Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Copenhagen and Sparinvest Value.

Diversification Opportunities for OMX Copenhagen and Sparinvest Value

0.0

Correlation Coefficient

OMX Copenhagen

Sparinvest Value

Pay attention - limited upside

The 3 months correlation between OMX and Sparinvest is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding OMX Copenhagen All and Sparinvest Value Bonds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparinvest Value Bonds and OMX Copenhagen 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 OMX Copenhagen All are associated (or correlated) with Sparinvest Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparinvest Value Bonds has no effect on the direction of OMX Copenhagen i.e., OMX Copenhagen and Sparinvest Value go up and down completely randomly.

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Pair Corralation between OMX Copenhagen and Sparinvest Value

If you would invest 154,419 in OMX Copenhagen All on November 27, 2024 and sell it today you would earn a total of 4,755 from holding OMX Copenhagen All or generate 3.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

OMX Copenhagen All vs. Sparinvest Value Bonds

Performance

Timeline

OMX Copenhagen and Sparinvest Value Volatility Contrast

Predicted Return Density

Returns

OMX Copenhagen All

Pair trading matchups for OMX Copenhagen

	OMX Copenhagen vs. Ringkjoebing Landbobank AS
	OMX Copenhagen vs. Nordinvestments AS
	OMX Copenhagen vs. Fynske Bank AS
	OMX Copenhagen vs. NTG Nordic Transport

Sparinvest Value Bonds

Pair trading matchups for Sparinvest Value

	Sparinvest Value vs. Investeringsforeningen Bankinvest
	Sparinvest Value vs. Maj Invest Emerging
	Sparinvest Value vs. C WorldWide Globale

Pair Trading with OMX Copenhagen and Sparinvest Value

The main advantage of trading using opposite OMX Copenhagen and Sparinvest Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Copenhagen position performs unexpectedly, Sparinvest Value 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 Sparinvest Value will offset losses from the drop in Sparinvest Value's long position.

	OMX Copenhagen vs. Ringkjoebing Landbobank AS
	OMX Copenhagen vs. Nordinvestments AS
	OMX Copenhagen vs. Fynske Bank AS
	OMX Copenhagen vs. NTG Nordic Transport

The idea behind OMX Copenhagen All and Sparinvest Value Bonds pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

	Sparinvest Value vs. Investeringsforeningen Bankinvest
	Sparinvest Value vs. Maj Invest Emerging
	Sparinvest Value vs. C WorldWide Globale

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

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