Correlation Between Slandsbanki and Lgerin Egill

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

By analyzing existing cross correlation between slandsbanki hf and lgerin Egill Skallagrmsson, you can compare the effects of market volatilities on Slandsbanki and Lgerin Egill 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 Slandsbanki with a short position of Lgerin Egill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Slandsbanki and Lgerin Egill.

Diversification Opportunities for Slandsbanki and Lgerin Egill

0.0

Correlation Coefficient

Slandsbanki  Lgerin Egill

Pay attention - limited upside

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

Pair Corralation between Slandsbanki and Lgerin Egill

If you would invest  12,400  in slandsbanki hf on December 30, 2024 and sell it today you would earn a total of  150.00  from holding slandsbanki hf or generate 1.21% return on investment over 90 days.

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

slandsbanki hf  vs.  lgerin Egill Skallagrmsson

slandsbanki hf

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in slandsbanki hf are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental drivers, Slandsbanki is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

lgerin Egill Skallag

Risk-Adjusted Performance

Very Weak

Over the last 90 days lgerin Egill Skallagrmsson has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Lgerin Egill is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Slandsbanki and Lgerin Egill

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

The idea behind slandsbanki hf and lgerin Egill Skallagrmsson 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.