Correlation Between Fast Ejendom and CBrain AS
Can any of the company-specific risk be diversified away by investing in both Fast Ejendom and CBrain AS 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 Fast Ejendom and CBrain AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fast Ejendom and cBrain AS, you can compare the effects of market volatilities on Fast Ejendom and CBrain AS 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 Fast Ejendom with a short position of CBrain AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fast Ejendom and CBrain AS.
Diversification Opportunities for Fast Ejendom and CBrain AS
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fast and CBrain is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Fast Ejendom and cBrain AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on cBrain AS and Fast Ejendom 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 Fast Ejendom are associated (or correlated) with CBrain AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of cBrain AS has no effect on the direction of Fast Ejendom i.e., Fast Ejendom and CBrain AS go up and down completely randomly.
Pair Corralation between Fast Ejendom and CBrain AS
Assuming the 90 days trading horizon Fast Ejendom is expected to generate 0.42 times more return on investment than CBrain AS. However, Fast Ejendom is 2.37 times less risky than CBrain AS. It trades about 0.11 of its potential returns per unit of risk. cBrain AS is currently generating about -0.01 per unit of risk. If you would invest 11,900 in Fast Ejendom on December 30, 2024 and sell it today you would earn a total of 1,600 from holding Fast Ejendom or generate 13.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Fast Ejendom vs. cBrain AS
Performance |
Timeline |
Fast Ejendom |
Risk-Adjusted Performance
OK
Weak | Strong |
cBrain AS |
Fast Ejendom and CBrain AS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fast Ejendom and CBrain AS
The main advantage of trading using opposite Fast Ejendom and CBrain AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fast Ejendom position performs unexpectedly, CBrain AS 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 CBrain AS will offset losses from the drop in CBrain AS's long position.Fast Ejendom vs. Prime Office AS | Fast Ejendom vs. First Farms AS | Fast Ejendom vs. Jeudan | Fast Ejendom vs. Gabriel Holding |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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