Correlation Between Svenska Handelsbanken and ANZ Group
Can any of the company-specific risk be diversified away by investing in both Svenska Handelsbanken and ANZ Group 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 Svenska Handelsbanken and ANZ Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Svenska Handelsbanken PK and ANZ Group Holdings, you can compare the effects of market volatilities on Svenska Handelsbanken and ANZ Group 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 Svenska Handelsbanken with a short position of ANZ Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Svenska Handelsbanken and ANZ Group.
Diversification Opportunities for Svenska Handelsbanken and ANZ Group
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Svenska and ANZ is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Svenska Handelsbanken PK and ANZ Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANZ Group Holdings and Svenska Handelsbanken 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 Svenska Handelsbanken PK are associated (or correlated) with ANZ Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANZ Group Holdings has no effect on the direction of Svenska Handelsbanken i.e., Svenska Handelsbanken and ANZ Group go up and down completely randomly.
Pair Corralation between Svenska Handelsbanken and ANZ Group
If you would invest 507.00 in Svenska Handelsbanken PK on September 6, 2024 and sell it today you would earn a total of 23.00 from holding Svenska Handelsbanken PK or generate 4.54% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 1.59% |
Values | Daily Returns |
Svenska Handelsbanken PK vs. ANZ Group Holdings
Performance |
Timeline |
Svenska Handelsbanken |
ANZ Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Svenska Handelsbanken and ANZ Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Svenska Handelsbanken and ANZ Group
The main advantage of trading using opposite Svenska Handelsbanken and ANZ Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Svenska Handelsbanken position performs unexpectedly, ANZ Group 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 ANZ Group will offset losses from the drop in ANZ Group's long position.Svenska Handelsbanken vs. China Construction Bank | Svenska Handelsbanken vs. Industrial and Commercial | Svenska Handelsbanken vs. Bank of America | Svenska Handelsbanken vs. Bank of America |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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