Correlation Between SpareBank and Danske Bank
Can any of the company-specific risk be diversified away by investing in both SpareBank and Danske Bank 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 SpareBank and Danske Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SpareBank 1 SMN and Danske Bank AS, you can compare the effects of market volatilities on SpareBank and Danske Bank 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 SpareBank with a short position of Danske Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of SpareBank and Danske Bank.
Diversification Opportunities for SpareBank and Danske Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SpareBank and Danske is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SpareBank 1 SMN and Danske Bank AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Danske Bank AS and 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 SpareBank 1 SMN are associated (or correlated) with Danske Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Danske Bank AS has no effect on the direction of SpareBank i.e., SpareBank and Danske Bank go up and down completely randomly.
Pair Corralation between SpareBank and Danske Bank
If you would invest 1,243 in SpareBank 1 SMN on October 21, 2024 and sell it today you would earn a total of 0.00 from holding SpareBank 1 SMN or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SpareBank 1 SMN vs. Danske Bank AS
Performance |
| Timeline |
| SpareBank 1 SMN |
| Danske Bank AS |
SpareBank and Danske Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SpareBank and Danske Bank
The main advantage of trading using opposite SpareBank and Danske Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SpareBank position performs unexpectedly, Danske Bank 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 Danske Bank will offset losses from the drop in Danske Bank's long position.| SpareBank vs. Danske Bank AS | SpareBank vs. Erste Group Bank | SpareBank vs. Texas Community Bancshares | SpareBank vs. Richmond Mutual Bancorporation |
| Danske Bank vs. Eurobank Ergasias SA | Danske Bank vs. National Bank of | Danske Bank vs. Piraeus Bank SA | Danske Bank vs. Lloyds Banking Group |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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