Correlation Between USWE Sports and Nordea Bank
Can any of the company-specific risk be diversified away by investing in both USWE Sports 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 USWE Sports and Nordea Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USWE Sports AB and Nordea Bank Abp, you can compare the effects of market volatilities on USWE Sports 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 USWE Sports with a short position of Nordea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of USWE Sports and Nordea Bank.
Diversification Opportunities for USWE Sports and Nordea Bank
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between USWE and Nordea is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding USWE Sports 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 USWE Sports 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 USWE Sports 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 USWE Sports i.e., USWE Sports and Nordea Bank go up and down completely randomly.
Pair Corralation between USWE Sports and Nordea Bank
Assuming the 90 days trading horizon USWE Sports AB is expected to generate 2.94 times more return on investment than Nordea Bank. However, USWE Sports is 2.94 times more volatile than Nordea Bank Abp. It trades about 0.25 of its potential returns per unit of risk. Nordea Bank Abp is currently generating about 0.07 per unit of risk. If you would invest 900.00 in USWE Sports AB on November 7, 2024 and sell it today you would earn a total of 130.00 from holding USWE Sports AB or generate 14.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
USWE Sports AB vs. Nordea Bank Abp
Performance |
| Timeline |
| USWE Sports AB |
| Nordea Bank Abp |
USWE Sports and Nordea Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USWE Sports and Nordea Bank
The main advantage of trading using opposite USWE Sports and Nordea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USWE Sports 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.| USWE Sports vs. Awardit AB | USWE Sports vs. RVRC Holding AB | USWE Sports vs. MIPS AB | USWE Sports vs. Smart Eye AB |
| Nordea Bank vs. Scandic Hotels Group | Nordea Bank vs. eEducation Albert AB | Nordea Bank vs. Viaplay Group AB | 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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |