Correlation Between PARKEN Sport and Hvidbjerg Bank
Can any of the company-specific risk be diversified away by investing in both PARKEN Sport and Hvidbjerg 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 PARKEN Sport and Hvidbjerg Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PARKEN Sport Entertainment and Hvidbjerg Bank, you can compare the effects of market volatilities on PARKEN Sport and Hvidbjerg 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 PARKEN Sport with a short position of Hvidbjerg Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and Hvidbjerg Bank.
Diversification Opportunities for PARKEN Sport and Hvidbjerg Bank
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between PARKEN and Hvidbjerg is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and Hvidbjerg Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hvidbjerg Bank and PARKEN Sport 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 PARKEN Sport Entertainment are associated (or correlated) with Hvidbjerg Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hvidbjerg Bank has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and Hvidbjerg Bank go up and down completely randomly.
Pair Corralation between PARKEN Sport and Hvidbjerg Bank
Assuming the 90 days trading horizon PARKEN Sport Entertainment is expected to under-perform the Hvidbjerg Bank. In addition to that, PARKEN Sport is 1.52 times more volatile than Hvidbjerg Bank. It trades about -0.04 of its total potential returns per unit of risk. Hvidbjerg Bank is currently generating about 0.04 per unit of volatility. If you would invest 10,600 in Hvidbjerg Bank on August 29, 2024 and sell it today you would earn a total of 1,200 from holding Hvidbjerg Bank or generate 11.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
PARKEN Sport Entertainment vs. Hvidbjerg Bank
Performance |
| Timeline |
| PARKEN Sport Enterta |
| Hvidbjerg Bank |
PARKEN Sport and Hvidbjerg Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PARKEN Sport and Hvidbjerg Bank
The main advantage of trading using opposite PARKEN Sport and Hvidbjerg Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport position performs unexpectedly, Hvidbjerg 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 Hvidbjerg Bank will offset losses from the drop in Hvidbjerg Bank's long position.| PARKEN Sport vs. Broendbyernes IF Fodbold | PARKEN Sport vs. Bang Olufsen | PARKEN Sport vs. Matas AS | PARKEN Sport vs. NKT AS |
| Hvidbjerg Bank vs. Sydbank AS | Hvidbjerg Bank vs. Jyske Bank AS | Hvidbjerg Bank vs. Alm Brand | Hvidbjerg Bank vs. Nordea Bank Abp |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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