Correlation Between URBAN OUTFITTERS and DNB BANK
Can any of the company-specific risk be diversified away by investing in both URBAN OUTFITTERS and DNB 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 URBAN OUTFITTERS and DNB BANK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between URBAN OUTFITTERS and DNB BANK ASA, you can compare the effects of market volatilities on URBAN OUTFITTERS and DNB 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 URBAN OUTFITTERS with a short position of DNB BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of URBAN OUTFITTERS and DNB BANK.
Diversification Opportunities for URBAN OUTFITTERS and DNB BANK
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between URBAN and DNB is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding URBAN OUTFITTERS and DNB BANK ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DNB BANK ASA and URBAN OUTFITTERS 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 URBAN OUTFITTERS are associated (or correlated) with DNB BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DNB BANK ASA has no effect on the direction of URBAN OUTFITTERS i.e., URBAN OUTFITTERS and DNB BANK go up and down completely randomly.
Pair Corralation between URBAN OUTFITTERS and DNB BANK
Assuming the 90 days trading horizon URBAN OUTFITTERS is expected to generate 1.6 times more return on investment than DNB BANK. However, URBAN OUTFITTERS is 1.6 times more volatile than DNB BANK ASA. It trades about 0.3 of its potential returns per unit of risk. DNB BANK ASA is currently generating about 0.03 per unit of risk. If you would invest 3,660 in URBAN OUTFITTERS on September 12, 2024 and sell it today you would earn a total of 1,240 from holding URBAN OUTFITTERS or generate 33.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
URBAN OUTFITTERS vs. DNB BANK ASA
Performance |
| Timeline |
| URBAN OUTFITTERS |
| DNB BANK ASA |
URBAN OUTFITTERS and DNB BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with URBAN OUTFITTERS and DNB BANK
The main advantage of trading using opposite URBAN OUTFITTERS and DNB BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if URBAN OUTFITTERS position performs unexpectedly, DNB 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 DNB BANK will offset losses from the drop in DNB BANK's long position.| URBAN OUTFITTERS vs. Apple Inc | URBAN OUTFITTERS vs. Apple Inc | URBAN OUTFITTERS vs. Apple Inc | URBAN OUTFITTERS vs. Apple Inc |
| DNB BANK vs. Superior Plus Corp | DNB BANK vs. SIVERS SEMICONDUCTORS AB | DNB BANK vs. CHINA HUARONG ENERHD 50 | DNB BANK vs. NORDIC HALIBUT 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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