Correlation Between Handelsinvest Danske and Gyldendal

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

By analyzing existing cross correlation between Handelsinvest Danske Obligationer and Gyldendal AS, you can compare the effects of market volatilities on Handelsinvest Danske and Gyldendal 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 Handelsinvest Danske with a short position of Gyldendal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Handelsinvest Danske and Gyldendal.

Diversification Opportunities for Handelsinvest Danske and Gyldendal

-0.39

Correlation Coefficient

Handelsinvest Danske  Gyldendal

Very good diversification

The 3 months correlation between Handelsinvest and Gyldendal is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Handelsinvest Danske Obligatio and Gyldendal AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gyldendal AS and Handelsinvest Danske 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 Handelsinvest Danske Obligationer are associated (or correlated) with Gyldendal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gyldendal AS has no effect on the direction of Handelsinvest Danske i.e., Handelsinvest Danske and Gyldendal go up and down completely randomly.

Pair Corralation between Handelsinvest Danske and Gyldendal

Assuming the 90 days trading horizon Handelsinvest Danske is expected to generate 2.67 times less return on investment than Gyldendal. But when comparing it to its historical volatility, Handelsinvest Danske Obligationer is 21.52 times less risky than Gyldendal. It trades about 0.1 of its potential returns per unit of risk. Gyldendal AS is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  154,000  in Gyldendal AS on October 4, 2024 and sell it today you would lose (18,000) from holding Gyldendal AS or give up 11.69% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Handelsinvest Danske Obligatio  vs.  Gyldendal AS

Handelsinvest Danske

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Handelsinvest Danske Obligationer are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong forward-looking signals, Handelsinvest Danske is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Gyldendal AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gyldendal AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's essential indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Handelsinvest Danske and Gyldendal

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

The idea behind Handelsinvest Danske Obligationer and Gyldendal AS 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.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.