Correlation Between BerolinaCapital Premium and Nordea 1

Can any of the company-specific risk be diversified away by investing in both BerolinaCapital Premium and Nordea 1 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 BerolinaCapital Premium and Nordea 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BerolinaCapital Premium and Nordea 1 SICAV, you can compare the effects of market volatilities on BerolinaCapital Premium and Nordea 1 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 BerolinaCapital Premium with a short position of Nordea 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of BerolinaCapital Premium and Nordea 1.

Diversification Opportunities for BerolinaCapital Premium and Nordea 1

0.0

Correlation Coefficient

BerolinaCapital Premium  Nordea 1

Pay attention - limited upside

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

Pair Corralation between BerolinaCapital Premium and Nordea 1

If you would invest  8,557  in BerolinaCapital Premium on October 4, 2024 and sell it today you would earn a total of  653.00  from holding BerolinaCapital Premium or generate 7.63% return on investment over 90 days.

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

BerolinaCapital Premium  vs.  Nordea 1 SICAV

BerolinaCapital Premium

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in BerolinaCapital Premium are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable fundamental indicators, BerolinaCapital Premium is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Nordea 1 SICAV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nordea 1 SICAV has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, Nordea 1 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with BerolinaCapital Premium and Nordea 1

The main advantage of trading using opposite BerolinaCapital Premium and Nordea 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BerolinaCapital Premium position performs unexpectedly, Nordea 1 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 Nordea 1 will offset losses from the drop in Nordea 1's long position.

The idea behind BerolinaCapital Premium and Nordea 1 SICAV 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.