Correlation Between Jyske Bank and BankIn Bredygt

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

By analyzing existing cross correlation between Jyske Bank AS and BankIn Bredygt Klimaakt, you can compare the effects of market volatilities on Jyske Bank and BankIn Bredygt 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 Jyske Bank with a short position of BankIn Bredygt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jyske Bank and BankIn Bredygt.

Diversification Opportunities for Jyske Bank and BankIn Bredygt

-0.45

Correlation Coefficient

Jyske Bank  BankIn Bredygt

Very good diversification

The 3 months correlation between Jyske and BankIn is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Jyske Bank AS and BankIn Bredygt Klimaakt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BankIn Bredygt Klimaakt and Jyske Bank 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 Jyske Bank AS are associated (or correlated) with BankIn Bredygt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BankIn Bredygt Klimaakt has no effect on the direction of Jyske Bank i.e., Jyske Bank and BankIn Bredygt go up and down completely randomly.

Pair Corralation between Jyske Bank and BankIn Bredygt

Assuming the 90 days trading horizon Jyske Bank is expected to generate 1.47 times less return on investment than BankIn Bredygt. But when comparing it to its historical volatility, Jyske Bank AS is 1.02 times less risky than BankIn Bredygt. It trades about 0.1 of its potential returns per unit of risk. BankIn Bredygt Klimaakt is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  10,585  in BankIn Bredygt Klimaakt on September 5, 2024 and sell it today you would earn a total of  315.00  from holding BankIn Bredygt Klimaakt or generate 2.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	78.26%
Values	Daily Returns

Jyske Bank AS  vs.  BankIn Bredygt Klimaakt

Jyske Bank AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jyske Bank AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Jyske Bank is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

BankIn Bredygt Klimaakt

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BankIn Bredygt Klimaakt are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating forward indicators, BankIn Bredygt sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jyske Bank and BankIn Bredygt

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

The idea behind Jyske Bank AS and BankIn Bredygt Klimaakt 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 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..