Correlation Between ROCKWOOL International and Dataproces Group
Can any of the company-specific risk be diversified away by investing in both ROCKWOOL International and Dataproces Group 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 ROCKWOOL International and Dataproces Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ROCKWOOL International AS and Dataproces Group AS, you can compare the effects of market volatilities on ROCKWOOL International and Dataproces Group 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 ROCKWOOL International with a short position of Dataproces Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of ROCKWOOL International and Dataproces Group.
Diversification Opportunities for ROCKWOOL International and Dataproces Group
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ROCKWOOL and Dataproces is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding ROCKWOOL International AS and Dataproces Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dataproces Group and ROCKWOOL International 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 ROCKWOOL International AS are associated (or correlated) with Dataproces Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dataproces Group has no effect on the direction of ROCKWOOL International i.e., ROCKWOOL International and Dataproces Group go up and down completely randomly.
Pair Corralation between ROCKWOOL International and Dataproces Group
Assuming the 90 days trading horizon ROCKWOOL International AS is expected to under-perform the Dataproces Group. In addition to that, ROCKWOOL International is 1.46 times more volatile than Dataproces Group AS. It trades about -0.28 of its total potential returns per unit of risk. Dataproces Group AS is currently generating about 0.05 per unit of volatility. If you would invest 585.00 in Dataproces Group AS on September 18, 2024 and sell it today you would earn a total of 10.00 from holding Dataproces Group AS or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ROCKWOOL International AS vs. Dataproces Group AS
Performance |
| Timeline |
| ROCKWOOL International |
| Dataproces Group |
ROCKWOOL International and Dataproces Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ROCKWOOL International and Dataproces Group
The main advantage of trading using opposite ROCKWOOL International and Dataproces Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ROCKWOOL International position performs unexpectedly, Dataproces Group 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 Dataproces Group will offset losses from the drop in Dataproces Group's long position.| ROCKWOOL International vs. FLSmidth Co | ROCKWOOL International vs. GN Store Nord | ROCKWOOL International vs. Ambu AS | ROCKWOOL International vs. DSV Panalpina AS |
| Dataproces Group vs. GN Store Nord | Dataproces Group vs. Ambu AS | Dataproces Group vs. ROCKWOOL International AS | Dataproces Group vs. Genmab 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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