Correlation Between Sydbank AS and Target
Can any of the company-specific risk be diversified away by investing in both Sydbank AS and Target 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 Sydbank AS and Target into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sydbank AS and Target, you can compare the effects of market volatilities on Sydbank AS and Target 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 Sydbank AS with a short position of Target. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sydbank AS and Target.
Diversification Opportunities for Sydbank AS and Target
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sydbank and Target is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Sydbank AS and Target in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Target and Sydbank AS 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 Sydbank AS are associated (or correlated) with Target. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Target has no effect on the direction of Sydbank AS i.e., Sydbank AS and Target go up and down completely randomly.
Pair Corralation between Sydbank AS and Target
Assuming the 90 days trading horizon Sydbank AS is expected to generate 0.99 times more return on investment than Target. However, Sydbank AS is 1.01 times less risky than Target. It trades about 0.08 of its potential returns per unit of risk. Target is currently generating about -0.02 per unit of risk. If you would invest 35,520 in Sydbank AS on January 19, 2024 and sell it today you would earn a total of 680.00 from holding Sydbank AS or generate 1.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 90.91% |
| Values | Daily Returns |
Sydbank AS vs. Target
Performance |
| Timeline |
| Sydbank AS |
| Target |
Sydbank AS and Target Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sydbank AS and Target
The main advantage of trading using opposite Sydbank AS and Target positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sydbank AS position performs unexpectedly, Target 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 Target will offset losses from the drop in Target's long position.| Sydbank AS vs. Jyske Bank AS | Sydbank AS vs. Tryg AS | Sydbank AS vs. FLSmidth Co | Sydbank AS vs. Nordea Bank Abp |
| Target vs. Betterware De Mexico | Target vs. Amexdrug | Target vs. Provident Bancorp | Target vs. Mersana Therapeutics |
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 AI Investment Finder module to use AI to screen and filter profitable investment opportunities.
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