Correlation Between Swedbank and PolyPlank Publ
Can any of the company-specific risk be diversified away by investing in both Swedbank and PolyPlank Publ 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 Swedbank and PolyPlank Publ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swedbank AB and PolyPlank publ AB, you can compare the effects of market volatilities on Swedbank and PolyPlank Publ 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 Swedbank with a short position of PolyPlank Publ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swedbank and PolyPlank Publ.
Diversification Opportunities for Swedbank and PolyPlank Publ
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swedbank and PolyPlank is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Swedbank AB and PolyPlank publ AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PolyPlank publ AB and Swedbank 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 Swedbank AB are associated (or correlated) with PolyPlank Publ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PolyPlank publ AB has no effect on the direction of Swedbank i.e., Swedbank and PolyPlank Publ go up and down completely randomly.
Pair Corralation between Swedbank and PolyPlank Publ
Assuming the 90 days trading horizon Swedbank AB is expected to generate 0.21 times more return on investment than PolyPlank Publ. However, Swedbank AB is 4.82 times less risky than PolyPlank Publ. It trades about 0.19 of its potential returns per unit of risk. PolyPlank publ AB is currently generating about -0.13 per unit of risk. If you would invest 21,820 in Swedbank AB on October 26, 2024 and sell it today you would earn a total of 2,850 from holding Swedbank AB or generate 13.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swedbank AB vs. PolyPlank publ AB
Performance |
| Timeline |
| Swedbank AB |
| PolyPlank publ AB |
Swedbank and PolyPlank Publ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swedbank and PolyPlank Publ
The main advantage of trading using opposite Swedbank and PolyPlank Publ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swedbank position performs unexpectedly, PolyPlank Publ 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 PolyPlank Publ will offset losses from the drop in PolyPlank Publ's long position.| Swedbank vs. Svenska Handelsbanken AB | Swedbank vs. Nordea Bank Abp | Swedbank vs. Telia Company AB | Swedbank vs. Tele2 AB |
| PolyPlank Publ vs. Saxlund Group AB | PolyPlank Publ vs. Online Brands Nordic | PolyPlank Publ vs. Organoclick AB | PolyPlank Publ vs. Minesto AB |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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