Correlation Between Sydbank AS and Ambu AS
Can any of the company-specific risk be diversified away by investing in both Sydbank AS and Ambu AS 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 Sydbank AS and Ambu AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sydbank AS and Ambu AS, you can compare the effects of market volatilities on Sydbank AS and Ambu AS 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 Sydbank AS with a short position of Ambu AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sydbank AS and Ambu AS.
Diversification Opportunities for Sydbank AS and Ambu AS
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sydbank and Ambu is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Sydbank AS and Ambu AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ambu AS and Sydbank AS 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 Sydbank AS are associated (or correlated) with Ambu AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ambu AS has no effect on the direction of Sydbank AS i.e., Sydbank AS and Ambu AS go up and down completely randomly.
Pair Corralation between Sydbank AS and Ambu AS
Assuming the 90 days trading horizon Sydbank AS is expected to generate 16.09 times less return on investment than Ambu AS. But when comparing it to its historical volatility, Sydbank AS is 2.73 times less risky than Ambu AS. It trades about 0.06 of its potential returns per unit of risk. Ambu AS is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 10,500 in Ambu AS on November 2, 2024 and sell it today you would earn a total of 3,260 from holding Ambu AS or generate 31.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sydbank AS vs. Ambu AS
Performance |
| Timeline |
| Sydbank AS |
| Ambu AS |
Sydbank AS and Ambu AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sydbank AS and Ambu AS
The main advantage of trading using opposite Sydbank AS and Ambu AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sydbank AS position performs unexpectedly, Ambu AS 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 Ambu AS will offset losses from the drop in Ambu AS's long position.| Sydbank AS vs. Jyske Bank AS | Sydbank AS vs. Tryg AS | Sydbank AS vs. FLSmidth Co | Sydbank AS vs. Nordea Bank Abp |
| Ambu AS vs. Bavarian Nordic | Ambu AS vs. Genmab AS | Ambu AS vs. GN Store Nord | Ambu AS vs. DSV Panalpina AS |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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