Correlation Between Maj Invest and DKIDMOBL

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

By analyzing existing cross correlation between Maj Invest UCITS and Investeringsforeningen Danske Invest, you can compare the effects of market volatilities on Maj Invest and DKIDMOBL 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 Maj Invest with a short position of DKIDMOBL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maj Invest and DKIDMOBL.

Diversification Opportunities for Maj Invest and DKIDMOBL

-0.87

Correlation Coefficient

Maj Invest  DKIDMOBL

Pay attention - limited upside

The 3 months correlation between Maj and DKIDMOBL is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Maj Invest UCITS and Investeringsforeningen Danske in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investeringsforeningen and Maj Invest 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 Maj Invest UCITS are associated (or correlated) with DKIDMOBL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investeringsforeningen has no effect on the direction of Maj Invest i.e., Maj Invest and DKIDMOBL go up and down completely randomly.

Pair Corralation between Maj Invest and DKIDMOBL

Assuming the 90 days trading horizon Maj Invest UCITS is expected to generate 3.87 times more return on investment than DKIDMOBL. However, Maj Invest is 3.87 times more volatile than Investeringsforeningen Danske Invest. It trades about 0.23 of its potential returns per unit of risk. Investeringsforeningen Danske Invest is currently generating about -0.11 per unit of risk. If you would invest  11,155  in Maj Invest UCITS on December 24, 2024 and sell it today you would earn a total of  1,495  from holding Maj Invest UCITS or generate 13.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.33%
Values	Daily Returns

Maj Invest UCITS  vs.  Investeringsforeningen Danske

Maj Invest UCITS

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Maj Invest UCITS are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak forward-looking indicators, Maj Invest sustained solid returns over the last few months and may actually be approaching a breakup point.

Investeringsforeningen

Risk-Adjusted Performance

Very Weak

Over the last 90 days Investeringsforeningen Danske Invest has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong primary indicators, DKIDMOBL is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Maj Invest and DKIDMOBL

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

The idea behind Maj Invest UCITS and Investeringsforeningen Danske Invest 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.