Correlation Between Boeing and DNB ASA

Can any of the company-specific risk be diversified away by investing in both Boeing and DNB ASA 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 Boeing and DNB ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between The Boeing and DNB ASA, you can compare the effects of market volatilities on Boeing and DNB ASA 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 Boeing with a short position of DNB ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boeing and DNB ASA.

Diversification Opportunities for Boeing and DNB ASA

0.0

Correlation Coefficient

Boeing  DNB ASA

Pay attention - limited upside

The 3 months correlation between Boeing and DNB is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and DNB ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DNB ASA and Boeing 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 The Boeing are associated (or correlated) with DNB ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DNB ASA has no effect on the direction of Boeing i.e., Boeing and DNB ASA go up and down completely randomly.

Pair Corralation between Boeing and DNB ASA

If you would invest  17,048  in The Boeing on February 22, 2024 and sell it today you would earn a total of  1,430  from holding The Boeing or generate 8.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

The Boeing  vs.  DNB ASA

Boeing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days The Boeing has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

DNB ASA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DNB ASA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical indicators, DNB ASA is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Boeing and DNB ASA

The main advantage of trading using opposite Boeing and DNB ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing position performs unexpectedly, DNB ASA 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 ASA will offset losses from the drop in DNB ASA's long position.

The idea behind The Boeing and DNB ASA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.