Correlation Between Sparinv SICAV and Jyske Invest

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

By analyzing existing cross correlation between Sparinv SICAV and Jyske Invest Nye, you can compare the effects of market volatilities on Sparinv SICAV and Jyske Invest 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 Sparinv SICAV with a short position of Jyske Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sparinv SICAV and Jyske Invest.

Diversification Opportunities for Sparinv SICAV and Jyske Invest

0.25

Correlation Coefficient

Sparinv SICAV  Jyske Invest

Modest diversification

The 3 months correlation between Sparinv and Jyske is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Sparinv SICAV and Jyske Invest Nye in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jyske Invest Nye and Sparinv SICAV 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 Sparinv SICAV are associated (or correlated) with Jyske Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jyske Invest Nye has no effect on the direction of Sparinv SICAV i.e., Sparinv SICAV and Jyske Invest go up and down completely randomly.

Pair Corralation between Sparinv SICAV and Jyske Invest

Assuming the 90 days trading horizon Sparinv SICAV is expected to generate 1.87 times more return on investment than Jyske Invest. However, Sparinv SICAV is 1.87 times more volatile than Jyske Invest Nye. It trades about 0.22 of its potential returns per unit of risk. Jyske Invest Nye is currently generating about 0.08 per unit of risk. If you would invest  26,750  in Sparinv SICAV on September 12, 2024 and sell it today you would earn a total of  2,920  from holding Sparinv SICAV or generate 10.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Sparinv SICAV  vs.  Jyske Invest Nye

Sparinv SICAV

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Sparinv SICAV are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather weak technical and fundamental indicators, Sparinv SICAV may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Jyske Invest Nye

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jyske Invest Nye are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong forward indicators, Jyske Invest is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Sparinv SICAV and Jyske Invest

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

The idea behind Sparinv SICAV and Jyske Invest Nye 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.