Correlation Between Copenhagen Airports and Aquaporin

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

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

Diversification Opportunities for Copenhagen Airports and Aquaporin

0.0

Correlation Coefficient

Copenhagen Airports  Aquaporin

Pay attention - limited upside

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

Pair Corralation between Copenhagen Airports and Aquaporin

If you would invest  614,000  in Copenhagen Airports AS on December 25, 2024 and sell it today you would earn a total of  34,000  from holding Copenhagen Airports AS or generate 5.54% return on investment over 90 days.

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

Copenhagen Airports AS  vs.  Aquaporin AS

Copenhagen Airports

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Copenhagen Airports AS are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Copenhagen Airports is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Aquaporin AS

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Copenhagen Airports and Aquaporin

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

The idea behind Copenhagen Airports AS and Aquaporin 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.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.