Correlation Between SpareBank and EAM Solar
Can any of the company-specific risk be diversified away by investing in both SpareBank and EAM Solar 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 SpareBank and EAM Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SpareBank 1 stlandet and EAM Solar ASA, you can compare the effects of market volatilities on SpareBank and EAM Solar 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 SpareBank with a short position of EAM Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of SpareBank and EAM Solar.
Diversification Opportunities for SpareBank and EAM Solar
Excellent diversification
The 3 months correlation between SpareBank and EAM is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding SpareBank 1 stlandet and EAM Solar ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EAM Solar ASA and SpareBank 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 SpareBank 1 stlandet are associated (or correlated) with EAM Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EAM Solar ASA has no effect on the direction of SpareBank i.e., SpareBank and EAM Solar go up and down completely randomly.
Pair Corralation between SpareBank and EAM Solar
Assuming the 90 days trading horizon SpareBank 1 stlandet is expected to generate 0.17 times more return on investment than EAM Solar. However, SpareBank 1 stlandet is 5.88 times less risky than EAM Solar. It trades about 0.45 of its potential returns per unit of risk. EAM Solar ASA is currently generating about 0.02 per unit of risk. If you would invest 12,468 in SpareBank 1 stlandet on February 4, 2024 and sell it today you would earn a total of 1,052 from holding SpareBank 1 stlandet or generate 8.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SpareBank 1 stlandet vs. EAM Solar ASA
Performance |
Timeline |
SpareBank 1 stlandet |
EAM Solar ASA |
SpareBank and EAM Solar Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SpareBank and EAM Solar
The main advantage of trading using opposite SpareBank and EAM Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SpareBank position performs unexpectedly, EAM Solar 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 EAM Solar will offset losses from the drop in EAM Solar's long position.SpareBank vs. Sparebanken Vest | SpareBank vs. Sparebank 1 Nord Norge | SpareBank vs. Sparebank 1 SMN | SpareBank vs. Sparebanken Ost |
EAM Solar vs. AF Gruppen ASA | EAM Solar vs. Aker ASA | EAM Solar vs. Kitron ASA | EAM Solar vs. Kongsberg Gruppen ASA |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |