Correlation Between First Trust and Danske Invest
Can any of the company-specific risk be diversified away by investing in both First Trust and Danske 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 First Trust and Danske Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust NASDAQ and Danske Invest Fjernsten, you can compare the effects of market volatilities on First Trust and Danske 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 First Trust with a short position of Danske Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Danske Invest.
Diversification Opportunities for First Trust and Danske Invest
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between First and Danske is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding First Trust NASDAQ and Danske Invest Fjernsten in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Danske Invest Fjernsten and First Trust 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 First Trust NASDAQ are associated (or correlated) with Danske Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Danske Invest Fjernsten has no effect on the direction of First Trust i.e., First Trust and Danske Invest go up and down completely randomly.
Pair Corralation between First Trust and Danske Invest
Given the investment horizon of 90 days First Trust is expected to generate 2.75 times less return on investment than Danske Invest. In addition to that, First Trust is 3.01 times more volatile than Danske Invest Fjernsten. It trades about 0.01 of its total potential returns per unit of risk. Danske Invest Fjernsten is currently generating about 0.12 per unit of volatility. If you would invest 5,546 in Danske Invest Fjernsten on December 30, 2023 and sell it today you would earn a total of 96.00 from holding Danske Invest Fjernsten or generate 1.73% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
First Trust NASDAQ vs. Danske Invest Fjernsten
Performance |
Timeline |
First Trust NASDAQ |
Danske Invest Fjernsten |
First Trust and Danske Invest Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with First Trust and Danske Invest
The main advantage of trading using opposite First Trust and Danske Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Danske 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 Danske Invest will offset losses from the drop in Danske Invest's long position.First Trust vs. Freedom Day Dividend | First Trust vs. Franklin Templeton ETF | First Trust vs. IShares MSCI China | First Trust vs. YieldMax DIS Option |
Danske Invest vs. Novo Nordisk AS | Danske Invest vs. Nordea Bank Abp | Danske Invest vs. DSV Panalpina AS | Danske Invest vs. AP Mller |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Equity Valuation Check real value of public entities based on technical and fundamental data | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume |