Correlation Between BlueNord ASA and Gjensidige Forsikring

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

By analyzing existing cross correlation between BlueNord ASA and Gjensidige Forsikring ASA, you can compare the effects of market volatilities on BlueNord ASA and Gjensidige Forsikring 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 BlueNord ASA with a short position of Gjensidige Forsikring. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlueNord ASA and Gjensidige Forsikring.

Diversification Opportunities for BlueNord ASA and Gjensidige Forsikring

0.0

Correlation Coefficient

BlueNord ASA  Gjensidige Forsikring

Pay attention - limited upside

The 3 months correlation between BlueNord and Gjensidige is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BlueNord ASA and Gjensidige Forsikring ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gjensidige Forsikring ASA and BlueNord ASA 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 BlueNord ASA are associated (or correlated) with Gjensidige Forsikring. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gjensidige Forsikring ASA has no effect on the direction of BlueNord ASA i.e., BlueNord ASA and Gjensidige Forsikring go up and down completely randomly.

Pair Corralation between BlueNord ASA and Gjensidige Forsikring

If you would invest  15,630  in Gjensidige Forsikring ASA on January 30, 2024 and sell it today you would earn a total of  2,320  from holding Gjensidige Forsikring ASA or generate 14.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

BlueNord ASA  vs.  Gjensidige Forsikring ASA

BlueNord ASA

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days BlueNord ASA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, BlueNord ASA is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Gjensidige Forsikring ASA

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Gjensidige Forsikring ASA are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting technical and fundamental indicators, Gjensidige Forsikring may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with BlueNord ASA and Gjensidige Forsikring

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

The idea behind BlueNord ASA and Gjensidige Forsikring ASA 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 CEOs Directory module to screen CEOs from public companies around the world.