Correlation Between Sogn Sparebank and Hexagon Purus
Can any of the company-specific risk be diversified away by investing in both Sogn Sparebank and Hexagon Purus 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 Sogn Sparebank and Hexagon Purus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sogn Sparebank and Hexagon Purus As, you can compare the effects of market volatilities on Sogn Sparebank and Hexagon Purus 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 Sogn Sparebank with a short position of Hexagon Purus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sogn Sparebank and Hexagon Purus.
Diversification Opportunities for Sogn Sparebank and Hexagon Purus
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sogn and Hexagon is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Sogn Sparebank and Hexagon Purus As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hexagon Purus As and Sogn 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 Sogn Sparebank are associated (or correlated) with Hexagon Purus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hexagon Purus As has no effect on the direction of Sogn Sparebank i.e., Sogn Sparebank and Hexagon Purus go up and down completely randomly.
Pair Corralation between Sogn Sparebank and Hexagon Purus
Assuming the 90 days trading horizon Sogn Sparebank is expected to generate 0.67 times more return on investment than Hexagon Purus. However, Sogn Sparebank is 1.48 times less risky than Hexagon Purus. It trades about 0.23 of its potential returns per unit of risk. Hexagon Purus As is currently generating about 0.1 per unit of risk. If you would invest 21,505 in Sogn Sparebank on September 13, 2024 and sell it today you would earn a total of 2,745 from holding Sogn Sparebank or generate 12.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sogn Sparebank vs. Hexagon Purus As
Performance |
| Timeline |
| Sogn Sparebank |
| Hexagon Purus As |
Sogn Sparebank and Hexagon Purus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sogn Sparebank and Hexagon Purus
The main advantage of trading using opposite Sogn Sparebank and Hexagon Purus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sogn Sparebank position performs unexpectedly, Hexagon Purus 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 Hexagon Purus will offset losses from the drop in Hexagon Purus' long position.| Sogn Sparebank vs. SpareBank 1 stlandet | Sogn Sparebank vs. Kongsberg Gruppen ASA | Sogn Sparebank vs. Napatech AS | Sogn Sparebank vs. Elkem ASA |
| Hexagon Purus vs. Scana ASA | Hexagon Purus vs. Elkem ASA | Hexagon Purus vs. Integrated Wind Solutions | Hexagon Purus vs. Vow ASA |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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