Correlation Between AstraZeneca PLC and Arion Banki
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By analyzing existing cross correlation between AstraZeneca PLC and Arion banki hf, you can compare the effects of market volatilities on AstraZeneca PLC and Arion Banki 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 AstraZeneca PLC with a short position of Arion Banki. Check out your portfolio center. Please also check ongoing floating volatility patterns of AstraZeneca PLC and Arion Banki.
Diversification Opportunities for AstraZeneca PLC and Arion Banki
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AstraZeneca and Arion is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding AstraZeneca PLC and Arion banki hf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arion banki hf and AstraZeneca PLC 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 AstraZeneca PLC are associated (or correlated) with Arion Banki. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arion banki hf has no effect on the direction of AstraZeneca PLC i.e., AstraZeneca PLC and Arion Banki go up and down completely randomly.
Pair Corralation between AstraZeneca PLC and Arion Banki
Assuming the 90 days trading horizon AstraZeneca PLC is expected to under-perform the Arion Banki. But the stock apears to be less risky and, when comparing its historical volatility, AstraZeneca PLC is 1.12 times less risky than Arion Banki. The stock trades about -0.18 of its potential returns per unit of risk. The Arion banki hf is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,040 in Arion banki hf on September 1, 2024 and sell it today you would earn a total of 200.00 from holding Arion banki hf or generate 19.23% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 98.48% |
Values | Daily Returns |
AstraZeneca PLC vs. Arion banki hf
Performance |
Timeline |
AstraZeneca PLC |
Arion banki hf |
AstraZeneca PLC and Arion Banki Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with AstraZeneca PLC and Arion Banki
The main advantage of trading using opposite AstraZeneca PLC and Arion Banki positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AstraZeneca PLC position performs unexpectedly, Arion Banki 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 Arion Banki will offset losses from the drop in Arion Banki's long position.AstraZeneca PLC vs. AB Volvo | AstraZeneca PLC vs. Telefonaktiebolaget LM Ericsson | AstraZeneca PLC vs. H M Hennes | AstraZeneca PLC vs. Investor AB ser |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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