Correlation Between Roblon AS and Per Aarsleff

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

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

Diversification Opportunities for Roblon AS and Per Aarsleff

0.65

Correlation Coefficient

Roblon AS  Per Aarsleff

Poor diversification

The 3 months correlation between Roblon and Per is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Roblon AS and Per Aarsleff Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Per Aarsleff Holding and Roblon AS 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 Roblon AS are associated (or correlated) with Per Aarsleff. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Per Aarsleff Holding has no effect on the direction of Roblon AS i.e., Roblon AS and Per Aarsleff go up and down completely randomly.

Pair Corralation between Roblon AS and Per Aarsleff

Assuming the 90 days trading horizon Roblon AS is expected to under-perform the Per Aarsleff. In addition to that, Roblon AS is 1.14 times more volatile than Per Aarsleff Holding. It trades about -0.03 of its total potential returns per unit of risk. Per Aarsleff Holding is currently generating about 0.08 per unit of volatility. If you would invest  27,909  in Per Aarsleff Holding on October 12, 2024 and sell it today you would earn a total of  21,091  from holding Per Aarsleff Holding or generate 75.57% return on investment over 90 days.

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

Roblon AS  vs.  Per Aarsleff Holding

Roblon AS

Risk-Adjusted Performance

12 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Roblon AS are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating essential indicators, Roblon AS sustained solid returns over the last few months and may actually be approaching a breakup point.

Per Aarsleff Holding

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Per Aarsleff Holding are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Per Aarsleff sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Roblon AS and Per Aarsleff

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

The idea behind Roblon AS and Per Aarsleff Holding 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.