Correlation Between Sparebanken Sor and Saga Pure
Can any of the company-specific risk be diversified away by investing in both Sparebanken Sor and Saga Pure 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 Sparebanken Sor and Saga Pure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sparebanken Sor and Saga Pure ASA, you can compare the effects of market volatilities on Sparebanken Sor and Saga Pure 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 Sparebanken Sor with a short position of Saga Pure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sparebanken Sor and Saga Pure.
Diversification Opportunities for Sparebanken Sor and Saga Pure
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sparebanken and Saga is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Sparebanken Sor and Saga Pure ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saga Pure ASA and Sparebanken Sor 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 Sparebanken Sor are associated (or correlated) with Saga Pure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saga Pure ASA has no effect on the direction of Sparebanken Sor i.e., Sparebanken Sor and Saga Pure go up and down completely randomly.
Pair Corralation between Sparebanken Sor and Saga Pure
Assuming the 90 days trading horizon Sparebanken Sor is expected to generate 1.29 times more return on investment than Saga Pure. However, Sparebanken Sor is 1.29 times more volatile than Saga Pure ASA. It trades about 0.34 of its potential returns per unit of risk. Saga Pure ASA is currently generating about -0.07 per unit of risk. If you would invest 18,500 in Sparebanken Sor on November 4, 2024 and sell it today you would earn a total of 2,615 from holding Sparebanken Sor or generate 14.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sparebanken Sor vs. Saga Pure ASA
Performance |
| Timeline |
| Sparebanken Sor |
| Saga Pure ASA |
Sparebanken Sor and Saga Pure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sparebanken Sor and Saga Pure
The main advantage of trading using opposite Sparebanken Sor and Saga Pure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sparebanken Sor position performs unexpectedly, Saga Pure 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 Saga Pure will offset losses from the drop in Saga Pure's long position.| Sparebanken Sor vs. Sparebanken Vest | Sparebanken Sor vs. Sparebank 1 Nord Norge | Sparebanken Sor vs. Sparebank 1 SMN | Sparebanken Sor vs. Sparebanken Ost |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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