Correlation Between OMX Helsinki and Nordea Bank
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By analyzing existing cross correlation between OMX Helsinki 25 and Nordea Bank Abp, you can compare the effects of market volatilities on OMX Helsinki and Nordea 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 OMX Helsinki with a short position of Nordea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Helsinki and Nordea Bank.
Diversification Opportunities for OMX Helsinki and Nordea Bank
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between OMX and Nordea is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding OMX Helsinki 25 and Nordea Bank Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordea Bank Abp and OMX Helsinki 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 Helsinki 25 are associated (or correlated) with Nordea Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordea Bank Abp has no effect on the direction of OMX Helsinki i.e., OMX Helsinki and Nordea Bank go up and down completely randomly.
Pair Corralation between OMX Helsinki and Nordea Bank
Assuming the 90 days trading horizon OMX Helsinki 25 is expected to generate 0.71 times more return on investment than Nordea Bank. However, OMX Helsinki 25 is 1.42 times less risky than Nordea Bank. It trades about 0.38 of its potential returns per unit of risk. Nordea Bank Abp is currently generating about 0.25 per unit of risk. If you would invest 444,542 in OMX Helsinki 25 on November 18, 2024 and sell it today you would earn a total of 26,421 from holding OMX Helsinki 25 or generate 5.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
OMX Helsinki 25 vs. Nordea Bank Abp
Performance |
| Timeline |
OMX Helsinki and Nordea Bank Volatility Contrast
Predicted Return Density |
| Returns |
OMX Helsinki 25
Pair trading matchups for OMX Helsinki
Nordea Bank Abp
Pair trading matchups for Nordea Bank
Pair Trading with OMX Helsinki and Nordea Bank
The main advantage of trading using opposite OMX Helsinki and Nordea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Helsinki position performs unexpectedly, Nordea 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 Nordea Bank will offset losses from the drop in Nordea Bank's long position.| OMX Helsinki vs. SSH Communications Security | OMX Helsinki vs. HKFoods Oyj A | OMX Helsinki vs. Aiforia Technologies Oyj | OMX Helsinki vs. Alma Media Oyj |
| Nordea Bank vs. Sampo Oyj A | Nordea Bank vs. Fortum Oyj | Nordea Bank vs. UPM Kymmene Oyj | Nordea Bank vs. Neste Oil Oyj |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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