Correlation Between Jyske Bank and Israel Discount

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

By analyzing existing cross correlation between Jyske Bank AS and Israel Discount Bank, you can compare the effects of market volatilities on Jyske Bank and Israel Discount 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 Jyske Bank with a short position of Israel Discount. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jyske Bank and Israel Discount.

Diversification Opportunities for Jyske Bank and Israel Discount

0.26

Correlation Coefficient

Jyske Bank  Israel Discount

Modest diversification

The 12 months correlation between Jyske and Israel is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Jyske Bank AS and Israel Discount Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Israel Discount Bank and Jyske 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 Jyske Bank AS are associated (or correlated) with Israel Discount. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Israel Discount Bank has no effect on the direction of Jyske Bank i.e., Jyske Bank and Israel Discount go up and down completely randomly.

Pair Corralation between Jyske Bank and Israel Discount

If you would invest  1,429  in Jyske Bank AS on February 22, 2024 and sell it today you would earn a total of  0.00  from holding Jyske Bank AS or generate 0.0% return on investment over 90 days.

Time Period	12 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Jyske Bank AS  vs.  Israel Discount Bank

Jyske Bank AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jyske Bank AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward-looking signals, Jyske Bank is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Israel Discount Bank

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Israel Discount Bank are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Israel Discount showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jyske Bank and Israel Discount

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

The idea behind Jyske Bank AS and Israel Discount Bank 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.