Correlation Between STORE ELECTRONIC and ROMERIKE SPAREBANK
Can any of the company-specific risk be diversified away by investing in both STORE ELECTRONIC and ROMERIKE SPAREBANK 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 STORE ELECTRONIC and ROMERIKE SPAREBANK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STORE ELECTRONIC and ROMERIKE SPAREBANK NK, you can compare the effects of market volatilities on STORE ELECTRONIC and ROMERIKE SPAREBANK 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 STORE ELECTRONIC with a short position of ROMERIKE SPAREBANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of STORE ELECTRONIC and ROMERIKE SPAREBANK.
Diversification Opportunities for STORE ELECTRONIC and ROMERIKE SPAREBANK
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between STORE and ROMERIKE is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding STORE ELECTRONIC and ROMERIKE SPAREBANK NK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ROMERIKE SPAREBANK and STORE ELECTRONIC 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 STORE ELECTRONIC are associated (or correlated) with ROMERIKE SPAREBANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ROMERIKE SPAREBANK has no effect on the direction of STORE ELECTRONIC i.e., STORE ELECTRONIC and ROMERIKE SPAREBANK go up and down completely randomly.
Pair Corralation between STORE ELECTRONIC and ROMERIKE SPAREBANK
Assuming the 90 days trading horizon STORE ELECTRONIC is expected to under-perform the ROMERIKE SPAREBANK. In addition to that, STORE ELECTRONIC is 1.78 times more volatile than ROMERIKE SPAREBANK NK. It trades about -0.03 of its total potential returns per unit of risk. ROMERIKE SPAREBANK NK is currently generating about 0.18 per unit of volatility. If you would invest 1,111 in ROMERIKE SPAREBANK NK on November 27, 2024 and sell it today you would earn a total of 48.00 from holding ROMERIKE SPAREBANK NK or generate 4.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
STORE ELECTRONIC vs. ROMERIKE SPAREBANK NK
Performance |
| Timeline |
| STORE ELECTRONIC |
| ROMERIKE SPAREBANK |
STORE ELECTRONIC and ROMERIKE SPAREBANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STORE ELECTRONIC and ROMERIKE SPAREBANK
The main advantage of trading using opposite STORE ELECTRONIC and ROMERIKE SPAREBANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STORE ELECTRONIC position performs unexpectedly, ROMERIKE SPAREBANK 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 ROMERIKE SPAREBANK will offset losses from the drop in ROMERIKE SPAREBANK's long position.| STORE ELECTRONIC vs. PARKEN SPORT ENT | STORE ELECTRONIC vs. TOREX SEMICONDUCTOR LTD | STORE ELECTRONIC vs. Magnachip Semiconductor | STORE ELECTRONIC vs. Yuexiu Transport Infrastructure |
| ROMERIKE SPAREBANK vs. Singapore Telecommunications Limited | ROMERIKE SPAREBANK vs. CHINA TELECOM H | ROMERIKE SPAREBANK vs. CITIC Telecom International | ROMERIKE SPAREBANK vs. Ribbon Communications |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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