Correlation Between Skjern Bank and Dataproces Group
Can any of the company-specific risk be diversified away by investing in both Skjern Bank 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 Skjern Bank and Dataproces Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Skjern Bank AS and Dataproces Group AS, you can compare the effects of market volatilities on Skjern Bank 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 Skjern Bank with a short position of Dataproces Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skjern Bank and Dataproces Group.
Diversification Opportunities for Skjern Bank and Dataproces Group
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Skjern and Dataproces is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Skjern Bank 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 Skjern Bank 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 Skjern Bank 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 Skjern Bank i.e., Skjern Bank and Dataproces Group go up and down completely randomly.
Pair Corralation between Skjern Bank and Dataproces Group
Assuming the 90 days trading horizon Skjern Bank AS is expected to under-perform the Dataproces Group. But the stock apears to be less risky and, when comparing its historical volatility, Skjern Bank AS is 2.89 times less risky than Dataproces Group. The stock trades about -0.3 of its potential returns per unit of risk. The Dataproces Group AS is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 590.00 in Dataproces Group AS on August 29, 2024 and sell it today you would lose (25.00) from holding Dataproces Group AS or give up 4.24% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Skjern Bank AS vs. Dataproces Group AS
Performance |
Timeline |
Skjern Bank AS |
Dataproces Group |
Skjern Bank and Dataproces Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Skjern Bank and Dataproces Group
The main advantage of trading using opposite Skjern Bank and Dataproces Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skjern Bank 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.Skjern Bank vs. Dataproces Group AS | Skjern Bank vs. cBrain AS | Skjern Bank vs. ALK Abell AS | Skjern Bank vs. ChemoMetec AS |
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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