Correlation Between Romerike Sparebank and Stolt Nielsen
Can any of the company-specific risk be diversified away by investing in both Romerike Sparebank and Stolt Nielsen 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 Romerike Sparebank and Stolt Nielsen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Romerike Sparebank and Stolt Nielsen Limited, you can compare the effects of market volatilities on Romerike Sparebank and Stolt Nielsen 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 Romerike Sparebank with a short position of Stolt Nielsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Romerike Sparebank and Stolt Nielsen.
Diversification Opportunities for Romerike Sparebank and Stolt Nielsen
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Romerike and Stolt is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Romerike Sparebank and Stolt Nielsen Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stolt Nielsen Limited and Romerike Sparebank 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 Romerike Sparebank are associated (or correlated) with Stolt Nielsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stolt Nielsen Limited has no effect on the direction of Romerike Sparebank i.e., Romerike Sparebank and Stolt Nielsen go up and down completely randomly.
Pair Corralation between Romerike Sparebank and Stolt Nielsen
Assuming the 90 days trading horizon Romerike Sparebank is expected to generate 1.19 times more return on investment than Stolt Nielsen. However, Romerike Sparebank is 1.19 times more volatile than Stolt Nielsen Limited. It trades about 0.08 of its potential returns per unit of risk. Stolt Nielsen Limited is currently generating about -0.35 per unit of risk. If you would invest 13,200 in Romerike Sparebank on December 1, 2024 and sell it today you would earn a total of 400.00 from holding Romerike Sparebank or generate 3.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Romerike Sparebank vs. Stolt Nielsen Limited
Performance |
| Timeline |
| Romerike Sparebank |
| Stolt Nielsen Limited |
Romerike Sparebank and Stolt Nielsen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Romerike Sparebank and Stolt Nielsen
The main advantage of trading using opposite Romerike Sparebank and Stolt Nielsen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Romerike Sparebank position performs unexpectedly, Stolt Nielsen 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 Stolt Nielsen will offset losses from the drop in Stolt Nielsen's long position.| Romerike Sparebank vs. Proximar Seafood AS | Romerike Sparebank vs. Sparebank 1 SMN | Romerike Sparebank vs. Austevoll Seafood ASA | Romerike Sparebank vs. Sparebanken Ost |
| Stolt Nielsen vs. Pareto Bank ASA | Stolt Nielsen vs. Morrow Bank ASA | Stolt Nielsen vs. Napatech AS | Stolt Nielsen vs. BW Offshore |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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