Correlation Between Upsales Technology and Nordea Bank
Can any of the company-specific risk be diversified away by investing in both Upsales Technology and Nordea 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 Upsales Technology and Nordea Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Upsales Technology AB and Nordea Bank Abp, you can compare the effects of market volatilities on Upsales Technology and Nordea 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 Upsales Technology with a short position of Nordea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Upsales Technology and Nordea Bank.
Diversification Opportunities for Upsales Technology and Nordea Bank
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Upsales and Nordea is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Upsales Technology AB and Nordea Bank Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordea Bank Abp and Upsales Technology 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 Upsales Technology AB are associated (or correlated) with Nordea Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordea Bank Abp has no effect on the direction of Upsales Technology i.e., Upsales Technology and Nordea Bank go up and down completely randomly.
Pair Corralation between Upsales Technology and Nordea Bank
Assuming the 90 days trading horizon Upsales Technology AB is expected to under-perform the Nordea Bank. But the stock apears to be less risky and, when comparing its historical volatility, Upsales Technology AB is 1.04 times less risky than Nordea Bank. The stock trades about -0.25 of its potential returns per unit of risk. The Nordea Bank Abp is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 12,210 in Nordea Bank Abp on November 3, 2024 and sell it today you would earn a total of 975.00 from holding Nordea Bank Abp or generate 7.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Upsales Technology AB vs. Nordea Bank Abp
Performance |
| Timeline |
| Upsales Technology |
| Nordea Bank Abp |
Upsales Technology and Nordea Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Upsales Technology and Nordea Bank
The main advantage of trading using opposite Upsales Technology and Nordea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Upsales Technology position performs unexpectedly, Nordea 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 Nordea Bank will offset losses from the drop in Nordea Bank's long position.| Upsales Technology vs. Lime Technologies AB | Upsales Technology vs. FormPipe Software AB | Upsales Technology vs. Surgical Science Sweden | Upsales Technology vs. Vitec Software Group |
| Nordea Bank vs. TF Bank AB | Nordea Bank vs. Catena Media plc | Nordea Bank vs. Arion banki hf | Nordea Bank vs. Investment AB Oresund |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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