Correlation Between ROMERIKE SPAREBANK and CITIC RESHLDGS

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

By analyzing existing cross correlation between ROMERIKE SPAREBANK NK and CITIC RESHLDGS HD, you can compare the effects of market volatilities on ROMERIKE SPAREBANK and CITIC RESHLDGS 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 ROMERIKE SPAREBANK with a short position of CITIC RESHLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of ROMERIKE SPAREBANK and CITIC RESHLDGS.

Diversification Opportunities for ROMERIKE SPAREBANK and CITIC RESHLDGS

0.0

Correlation Coefficient

ROMERIKE SPAREBANK  CITIC RESHLDGS

Pay attention - limited upside

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

Pair Corralation between ROMERIKE SPAREBANK and CITIC RESHLDGS

If you would invest  1,011  in ROMERIKE SPAREBANK NK on October 23, 2024 and sell it today you would earn a total of  62.00  from holding ROMERIKE SPAREBANK NK or generate 6.13% return on investment over 90 days.

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

ROMERIKE SPAREBANK NK  vs.  CITIC RESHLDGS HD

ROMERIKE SPAREBANK

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ROMERIKE SPAREBANK NK are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ROMERIKE SPAREBANK may actually be approaching a critical reversion point that can send shares even higher in February 2025.

CITIC RESHLDGS HD

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with ROMERIKE SPAREBANK and CITIC RESHLDGS

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

The idea behind ROMERIKE SPAREBANK NK and CITIC RESHLDGS HD 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.