Correlation Between Skandinaviska Enskilda and KBC Ancora

Can any of the company-specific risk be diversified away by investing in both Skandinaviska Enskilda and KBC Ancora 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 Skandinaviska Enskilda and KBC Ancora into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Skandinaviska Enskilda Banken and KBC Ancora SCA, you can compare the effects of market volatilities on Skandinaviska Enskilda and KBC Ancora 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 Skandinaviska Enskilda with a short position of KBC Ancora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skandinaviska Enskilda and KBC Ancora.

Diversification Opportunities for Skandinaviska Enskilda and KBC Ancora

0.7

Correlation Coefficient

Skandinaviska Enskilda  KBC Ancora

Poor diversification

The 3 months correlation between Skandinaviska and KBC is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Skandinaviska Enskilda Banken and KBC Ancora SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KBC Ancora SCA and Skandinaviska Enskilda 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 Skandinaviska Enskilda Banken are associated (or correlated) with KBC Ancora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KBC Ancora SCA has no effect on the direction of Skandinaviska Enskilda i.e., Skandinaviska Enskilda and KBC Ancora go up and down completely randomly.

Pair Corralation between Skandinaviska Enskilda and KBC Ancora

Assuming the 90 days trading horizon Skandinaviska Enskilda is expected to generate 1.43 times less return on investment than KBC Ancora. In addition to that, Skandinaviska Enskilda is 1.25 times more volatile than KBC Ancora SCA. It trades about 0.09 of its total potential returns per unit of risk. KBC Ancora SCA is currently generating about 0.16 per unit of volatility. If you would invest  5,355  in KBC Ancora SCA on April 24, 2025 and sell it today you would earn a total of  705.00  from holding KBC Ancora SCA or generate 13.17% return on investment over 90 days.

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

Skandinaviska Enskilda Banken  vs.  KBC Ancora SCA

Skandinaviska Enskilda

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Skandinaviska Enskilda Banken are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental drivers, Skandinaviska Enskilda may actually be approaching a critical reversion point that can send shares even higher in August 2025.

KBC Ancora SCA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in KBC Ancora SCA are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, KBC Ancora reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Skandinaviska Enskilda and KBC Ancora

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

The idea behind Skandinaviska Enskilda Banken and KBC Ancora SCA 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.