Correlation Between Nordea Bank and SaveLend Group

Can any of the company-specific risk be diversified away by investing in both Nordea Bank and SaveLend 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 Nordea Bank and SaveLend Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nordea Bank Abp and SaveLend Group AB, you can compare the effects of market volatilities on Nordea Bank and SaveLend 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 Nordea Bank with a short position of SaveLend Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordea Bank and SaveLend Group.

Diversification Opportunities for Nordea Bank and SaveLend Group

0.36

Correlation Coefficient

Nordea Bank  SaveLend Group

Weak diversification

The 3 months correlation between Nordea and SaveLend is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Nordea Bank Abp and SaveLend Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SaveLend Group AB and Nordea Bank 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 Nordea Bank Abp are associated (or correlated) with SaveLend Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SaveLend Group AB has no effect on the direction of Nordea Bank i.e., Nordea Bank and SaveLend Group go up and down completely randomly.

Pair Corralation between Nordea Bank and SaveLend Group

Assuming the 90 days trading horizon Nordea Bank is expected to generate 1.23 times less return on investment than SaveLend Group. But when comparing it to its historical volatility, Nordea Bank Abp is 2.63 times less risky than SaveLend Group. It trades about 0.15 of its potential returns per unit of risk. SaveLend Group AB is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  160.00  in SaveLend Group AB on April 20, 2025 and sell it today you would earn a total of  16.00  from holding SaveLend Group AB or generate 10.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Nordea Bank Abp  vs.  SaveLend Group AB

Nordea Bank Abp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nordea Bank Abp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Nordea Bank may actually be approaching a critical reversion point that can send shares even higher in August 2025.

SaveLend Group AB

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in SaveLend Group AB are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, SaveLend Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nordea Bank and SaveLend Group

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

The idea behind Nordea Bank Abp and SaveLend Group AB 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.

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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.