Correlation Between White Pearl and Nordea Bank
Can any of the company-specific risk be diversified away by investing in both White Pearl 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 White Pearl and Nordea Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between White Pearl Technology and Nordea Bank Abp, you can compare the effects of market volatilities on White Pearl 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 White Pearl with a short position of Nordea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of White Pearl and Nordea Bank.
Diversification Opportunities for White Pearl and Nordea Bank
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between White and Nordea is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding White Pearl Technology 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 White Pearl 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 White Pearl Technology 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 White Pearl i.e., White Pearl and Nordea Bank go up and down completely randomly.
Pair Corralation between White Pearl and Nordea Bank
Assuming the 90 days trading horizon White Pearl Technology is expected to generate 4.39 times more return on investment than Nordea Bank. However, White Pearl is 4.39 times more volatile than Nordea Bank Abp. It trades about 0.03 of its potential returns per unit of risk. Nordea Bank Abp is currently generating about 0.05 per unit of risk. If you would invest 496.00 in White Pearl Technology on August 31, 2024 and sell it today you would earn a total of 98.00 from holding White Pearl Technology or generate 19.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 96.82% |
| Values | Daily Returns |
White Pearl Technology vs. Nordea Bank Abp
Performance |
| Timeline |
| White Pearl Technology |
| Nordea Bank Abp |
White Pearl and Nordea Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with White Pearl and Nordea Bank
The main advantage of trading using opposite White Pearl and Nordea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if White Pearl 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.| White Pearl vs. AstraZeneca PLC | White Pearl vs. Investor AB ser | White Pearl vs. Investor AB ser | White Pearl vs. Atlas Copco AB |
| Nordea Bank vs. Svenska Handelsbanken AB | Nordea Bank vs. Telia Company AB | Nordea Bank vs. Tele2 AB | Nordea Bank vs. H M Hennes |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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