Correlation Between Romsdal Sparebank and HydrogenPro
Can any of the company-specific risk be diversified away by investing in both Romsdal Sparebank and HydrogenPro 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 Romsdal Sparebank and HydrogenPro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Romsdal Sparebank and HydrogenPro AS, you can compare the effects of market volatilities on Romsdal Sparebank and HydrogenPro 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 Romsdal Sparebank with a short position of HydrogenPro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Romsdal Sparebank and HydrogenPro.
Diversification Opportunities for Romsdal Sparebank and HydrogenPro
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Romsdal and HydrogenPro is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Romsdal Sparebank and HydrogenPro AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HydrogenPro AS and Romsdal 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 Romsdal Sparebank are associated (or correlated) with HydrogenPro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HydrogenPro AS has no effect on the direction of Romsdal Sparebank i.e., Romsdal Sparebank and HydrogenPro go up and down completely randomly.
Pair Corralation between Romsdal Sparebank and HydrogenPro
Assuming the 90 days trading horizon Romsdal Sparebank is expected to generate 0.17 times more return on investment than HydrogenPro. However, Romsdal Sparebank is 5.87 times less risky than HydrogenPro. It trades about 0.0 of its potential returns per unit of risk. HydrogenPro AS is currently generating about -0.18 per unit of risk. If you would invest 12,340 in Romsdal Sparebank on September 13, 2024 and sell it today you would lose (18.00) from holding Romsdal Sparebank or give up 0.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Romsdal Sparebank vs. HydrogenPro AS
Performance |
| Timeline |
| Romsdal Sparebank |
| HydrogenPro AS |
Romsdal Sparebank and HydrogenPro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Romsdal Sparebank and HydrogenPro
The main advantage of trading using opposite Romsdal Sparebank and HydrogenPro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Romsdal Sparebank position performs unexpectedly, HydrogenPro 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 HydrogenPro will offset losses from the drop in HydrogenPro's long position.| Romsdal Sparebank vs. Kongsberg Gruppen ASA | Romsdal Sparebank vs. Napatech AS | Romsdal Sparebank vs. Elkem ASA | Romsdal Sparebank vs. Scatec Solar OL |
| HydrogenPro vs. Vow Green Metals | HydrogenPro vs. Romsdal Sparebank | HydrogenPro vs. Skue Sparebank | HydrogenPro vs. Sparebanken Ost |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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