Correlation Between BankInvest Value and Jyske Invest

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

By analyzing existing cross correlation between BankInvest Value Globale and Jyske Invest Korte, you can compare the effects of market volatilities on BankInvest Value and Jyske 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 BankInvest Value with a short position of Jyske Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of BankInvest Value and Jyske Invest.

Diversification Opportunities for BankInvest Value and Jyske Invest

0.46

Correlation Coefficient

BankInvest Value  Jyske Invest

Very weak diversification

The 3 months correlation between BankInvest and Jyske is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding BankInvest Value Globale and Jyske Invest Korte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jyske Invest Korte and BankInvest Value 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 BankInvest Value Globale are associated (or correlated) with Jyske Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jyske Invest Korte has no effect on the direction of BankInvest Value i.e., BankInvest Value and Jyske Invest go up and down completely randomly.

Pair Corralation between BankInvest Value and Jyske Invest

Assuming the 90 days trading horizon BankInvest Value Globale is expected to under-perform the Jyske Invest. In addition to that, BankInvest Value is 12.94 times more volatile than Jyske Invest Korte. It trades about -0.13 of its total potential returns per unit of risk. Jyske Invest Korte is currently generating about -0.08 per unit of volatility. If you would invest  9,622  in Jyske Invest Korte on December 26, 2024 and sell it today you would lose (80.00) from holding Jyske Invest Korte or give up 0.83% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	94.74%
Values	Daily Returns

BankInvest Value Globale  vs.  Jyske Invest Korte

BankInvest Value Globale

Risk-Adjusted Performance

Very Weak

Over the last 90 days BankInvest Value Globale has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Jyske Invest Korte

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jyske Invest Korte has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward indicators, Jyske Invest is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with BankInvest Value and Jyske Invest

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

The idea behind BankInvest Value Globale and Jyske Invest Korte 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.

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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.