Correlation Between Vestas Wind and PFA Invest
Can any of the company-specific risk be diversified away by investing in both Vestas Wind and PFA Invest 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 Vestas Wind and PFA Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vestas Wind Systems and PFA Invest Kreditobligationer, you can compare the effects of market volatilities on Vestas Wind and PFA Invest 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 Vestas Wind with a short position of PFA Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vestas Wind and PFA Invest.
Diversification Opportunities for Vestas Wind and PFA Invest
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Vestas and PFA is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Vestas Wind Systems and PFA Invest Kreditobligationer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PFA Invest Kreditobl and Vestas Wind 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 Vestas Wind Systems are associated (or correlated) with PFA Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PFA Invest Kreditobl has no effect on the direction of Vestas Wind i.e., Vestas Wind and PFA Invest go up and down completely randomly.
Pair Corralation between Vestas Wind and PFA Invest
Assuming the 90 days trading horizon Vestas Wind Systems is expected to under-perform the PFA Invest. In addition to that, Vestas Wind is 17.73 times more volatile than PFA Invest Kreditobligationer. It trades about -0.09 of its total potential returns per unit of risk. PFA Invest Kreditobligationer is currently generating about 0.19 per unit of volatility. If you would invest 9,952 in PFA Invest Kreditobligationer on November 5, 2024 and sell it today you would earn a total of 692.00 from holding PFA Invest Kreditobligationer or generate 6.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vestas Wind Systems vs. PFA Invest Kreditobligationer
Performance |
| Timeline |
| Vestas Wind Systems |
| PFA Invest Kreditobl |
Vestas Wind and PFA Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vestas Wind and PFA Invest
The main advantage of trading using opposite Vestas Wind and PFA Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vestas Wind position performs unexpectedly, PFA Invest 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 PFA Invest will offset losses from the drop in PFA Invest's long position.| Vestas Wind vs. FLSmidth Co | Vestas Wind vs. NKT AS | Vestas Wind vs. Dampskibsselskabet Norden AS | Vestas Wind vs. GN Store Nord |
| PFA Invest vs. Prime Office AS | PFA Invest vs. Lollands Bank | PFA Invest vs. Nordfyns Bank AS | PFA Invest vs. Strategic Investments 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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