Correlation Between EgnsINVEST Ejendomme and Copenhagen Capital

Can any of the company-specific risk be diversified away by investing in both EgnsINVEST Ejendomme and Copenhagen Capital 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 EgnsINVEST Ejendomme and Copenhagen Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between EgnsINVEST Ejendomme Tyskland and Copenhagen Capital AS, you can compare the effects of market volatilities on EgnsINVEST Ejendomme and Copenhagen Capital 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 EgnsINVEST Ejendomme with a short position of Copenhagen Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of EgnsINVEST Ejendomme and Copenhagen Capital.

Diversification Opportunities for EgnsINVEST Ejendomme and Copenhagen Capital

0.66

Correlation Coefficient

EgnsINVEST Ejendomme  Copenhagen Capital

Poor diversification

The 3 months correlation between EgnsINVEST and Copenhagen is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding EgnsINVEST Ejendomme Tyskland and Copenhagen Capital AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copenhagen Capital and EgnsINVEST Ejendomme 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 EgnsINVEST Ejendomme Tyskland are associated (or correlated) with Copenhagen Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copenhagen Capital has no effect on the direction of EgnsINVEST Ejendomme i.e., EgnsINVEST Ejendomme and Copenhagen Capital go up and down completely randomly.

Pair Corralation between EgnsINVEST Ejendomme and Copenhagen Capital

Assuming the 90 days trading horizon EgnsINVEST Ejendomme Tyskland is expected to generate 1.01 times more return on investment than Copenhagen Capital. However, EgnsINVEST Ejendomme is 1.01 times more volatile than Copenhagen Capital AS. It trades about 0.27 of its potential returns per unit of risk. Copenhagen Capital AS is currently generating about 0.26 per unit of risk. If you would invest  13,800  in EgnsINVEST Ejendomme Tyskland on April 24, 2025 and sell it today you would earn a total of  3,800  from holding EgnsINVEST Ejendomme Tyskland or generate 27.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.36%
Values	Daily Returns

EgnsINVEST Ejendomme Tyskland  vs.  Copenhagen Capital AS

EgnsINVEST Ejendomme

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in EgnsINVEST Ejendomme Tyskland are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, EgnsINVEST Ejendomme sustained solid returns over the last few months and may actually be approaching a breakup point.

Copenhagen Capital

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Copenhagen Capital AS are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Copenhagen Capital sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EgnsINVEST Ejendomme and Copenhagen Capital

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

The idea behind EgnsINVEST Ejendomme Tyskland and Copenhagen Capital AS 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 Stocks Directory module to find actively traded stocks across global markets.