Correlation Between Tekna Holding and Melhus Sparebank
Can any of the company-specific risk be diversified away by investing in both Tekna Holding and Melhus Sparebank 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 Tekna Holding and Melhus Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tekna Holding AS and Melhus Sparebank, you can compare the effects of market volatilities on Tekna Holding and Melhus Sparebank 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 Tekna Holding with a short position of Melhus Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekna Holding and Melhus Sparebank.
Diversification Opportunities for Tekna Holding and Melhus Sparebank
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tekna and Melhus is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Tekna Holding AS and Melhus Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Melhus Sparebank and Tekna Holding 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 Tekna Holding AS are associated (or correlated) with Melhus Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Melhus Sparebank has no effect on the direction of Tekna Holding i.e., Tekna Holding and Melhus Sparebank go up and down completely randomly.
Pair Corralation between Tekna Holding and Melhus Sparebank
Assuming the 90 days trading horizon Tekna Holding AS is expected to under-perform the Melhus Sparebank. In addition to that, Tekna Holding is 8.67 times more volatile than Melhus Sparebank. It trades about -0.16 of its total potential returns per unit of risk. Melhus Sparebank is currently generating about 0.08 per unit of volatility. If you would invest 15,936 in Melhus Sparebank on August 29, 2024 and sell it today you would earn a total of 214.00 from holding Melhus Sparebank or generate 1.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tekna Holding AS vs. Melhus Sparebank
Performance |
| Timeline |
| Tekna Holding AS |
| Melhus Sparebank |
Tekna Holding and Melhus Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tekna Holding and Melhus Sparebank
The main advantage of trading using opposite Tekna Holding and Melhus Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tekna Holding position performs unexpectedly, Melhus Sparebank 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 Melhus Sparebank will offset losses from the drop in Melhus Sparebank's long position.| Tekna Holding vs. Melhus Sparebank | Tekna Holding vs. Xplora Technologies As | Tekna Holding vs. Sogn Sparebank | Tekna Holding vs. Kraft Bank Asa |
| Melhus Sparebank vs. Sparebank 1 Nord Norge | Melhus Sparebank vs. Aurskog Sparebank | Melhus Sparebank vs. Helgeland Sparebank |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |