Correlation Between Gyldendal and HH International
Can any of the company-specific risk be diversified away by investing in both Gyldendal and HH International 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 Gyldendal and HH International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gyldendal AS and HH International AS, you can compare the effects of market volatilities on Gyldendal and HH International 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 Gyldendal with a short position of HH International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gyldendal and HH International.
Diversification Opportunities for Gyldendal and HH International
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gyldendal and HH International is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Gyldendal AS and HH International AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HH International and Gyldendal 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 Gyldendal AS are associated (or correlated) with HH International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HH International has no effect on the direction of Gyldendal i.e., Gyldendal and HH International go up and down completely randomly.
Pair Corralation between Gyldendal and HH International
Assuming the 90 days trading horizon Gyldendal AS is expected to generate 2.88 times more return on investment than HH International. However, Gyldendal is 2.88 times more volatile than HH International AS. It trades about -0.05 of its potential returns per unit of risk. HH International AS is currently generating about -0.14 per unit of risk. If you would invest 158,000 in Gyldendal AS on October 4, 2024 and sell it today you would lose (22,000) from holding Gyldendal AS or give up 13.92% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Gyldendal AS vs. HH International AS
Performance |
Timeline |
Gyldendal AS |
HH International |
Gyldendal and HH International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Gyldendal and HH International
The main advantage of trading using opposite Gyldendal and HH International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gyldendal position performs unexpectedly, HH International 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 HH International will offset losses from the drop in HH International's long position.Gyldendal vs. Gyldendal AS | Gyldendal vs. Danske Andelskassers Bank | Gyldendal vs. Laan Spar Bank | Gyldendal vs. Kreditbanken AS |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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