Correlation Between Ringkjoebing Landbobank and BankIn Bredygt
Can any of the company-specific risk be diversified away by investing in both Ringkjoebing Landbobank and BankIn Bredygt 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 Ringkjoebing Landbobank and BankIn Bredygt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ringkjoebing Landbobank AS and BankIn Bredygt Klimaakt, you can compare the effects of market volatilities on Ringkjoebing Landbobank and BankIn Bredygt 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 Ringkjoebing Landbobank with a short position of BankIn Bredygt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ringkjoebing Landbobank and BankIn Bredygt.
Diversification Opportunities for Ringkjoebing Landbobank and BankIn Bredygt
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ringkjoebing and BankIn is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Ringkjoebing Landbobank AS and BankIn Bredygt Klimaakt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BankIn Bredygt Klimaakt and Ringkjoebing Landbobank 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 Ringkjoebing Landbobank AS are associated (or correlated) with BankIn Bredygt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BankIn Bredygt Klimaakt has no effect on the direction of Ringkjoebing Landbobank i.e., Ringkjoebing Landbobank and BankIn Bredygt go up and down completely randomly.
Pair Corralation between Ringkjoebing Landbobank and BankIn Bredygt
Assuming the 90 days trading horizon Ringkjoebing Landbobank AS is expected to under-perform the BankIn Bredygt. In addition to that, Ringkjoebing Landbobank is 1.63 times more volatile than BankIn Bredygt Klimaakt. It trades about -0.08 of its total potential returns per unit of risk. BankIn Bredygt Klimaakt is currently generating about 0.19 per unit of volatility. If you would invest 10,270 in BankIn Bredygt Klimaakt on October 19, 2024 and sell it today you would earn a total of 125.00 from holding BankIn Bredygt Klimaakt or generate 1.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 50.0% |
| Values | Daily Returns |
Ringkjoebing Landbobank AS vs. BankIn Bredygt Klimaakt
Performance |
| Timeline |
| Ringkjoebing Landbobank |
| BankIn Bredygt Klimaakt |
Ringkjoebing Landbobank and BankIn Bredygt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ringkjoebing Landbobank and BankIn Bredygt
The main advantage of trading using opposite Ringkjoebing Landbobank and BankIn Bredygt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ringkjoebing Landbobank position performs unexpectedly, BankIn Bredygt 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 BankIn Bredygt will offset losses from the drop in BankIn Bredygt's long position.| Ringkjoebing Landbobank vs. Sydbank AS | Ringkjoebing Landbobank vs. Jyske Bank AS | Ringkjoebing Landbobank vs. Royal Unibrew AS | Ringkjoebing Landbobank vs. Spar Nord Bank |
| BankIn Bredygt vs. North Media AS | BankIn Bredygt vs. Djurslands Bank | BankIn Bredygt vs. Laan Spar Bank | BankIn Bredygt vs. Kreditbanken 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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