Correlation Between SD Standard and Aasen Sparebank
Can any of the company-specific risk be diversified away by investing in both SD Standard and Aasen 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 SD Standard and Aasen Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SD Standard Drilling and Aasen Sparebank, you can compare the effects of market volatilities on SD Standard and Aasen 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 SD Standard with a short position of Aasen Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of SD Standard and Aasen Sparebank.
Diversification Opportunities for SD Standard and Aasen Sparebank
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SDSD and Aasen is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding SD Standard Drilling and Aasen Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aasen Sparebank and SD Standard 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 SD Standard Drilling are associated (or correlated) with Aasen Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aasen Sparebank has no effect on the direction of SD Standard i.e., SD Standard and Aasen Sparebank go up and down completely randomly.
Pair Corralation between SD Standard and Aasen Sparebank
Assuming the 90 days trading horizon SD Standard Drilling is expected to generate 0.84 times more return on investment than Aasen Sparebank. However, SD Standard Drilling is 1.19 times less risky than Aasen Sparebank. It trades about 0.09 of its potential returns per unit of risk. Aasen Sparebank is currently generating about 0.07 per unit of risk. If you would invest 162.00 in SD Standard Drilling on September 2, 2024 and sell it today you would earn a total of 9.00 from holding SD Standard Drilling or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SD Standard Drilling vs. Aasen Sparebank
Performance |
| Timeline |
| SD Standard Drilling |
| Aasen Sparebank |
SD Standard and Aasen Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SD Standard and Aasen Sparebank
The main advantage of trading using opposite SD Standard and Aasen Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SD Standard position performs unexpectedly, Aasen 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 Aasen Sparebank will offset losses from the drop in Aasen Sparebank's long position.| SD Standard vs. DnB ASA | SD Standard vs. Mowi ASA | SD Standard vs. Yara International ASA | SD Standard vs. Telenor ASA |
| Aasen Sparebank vs. Sparebank 1 SMN | Aasen Sparebank vs. Sparebank 1 Nord Norge | Aasen Sparebank vs. Sparebanken Vest | Aasen Sparebank vs. Sparebank 1 Ostfold |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |