Correlation Between Swedbank and Admiral Group
Can any of the company-specific risk be diversified away by investing in both Swedbank and Admiral 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 Swedbank and Admiral Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swedbank AB ser and Admiral Group PLC, you can compare the effects of market volatilities on Swedbank and Admiral 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 Swedbank with a short position of Admiral Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swedbank and Admiral Group.
Diversification Opportunities for Swedbank and Admiral Group
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Swedbank and Admiral is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Swedbank AB ser and Admiral Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Admiral Group PLC and Swedbank 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 Swedbank AB ser are associated (or correlated) with Admiral Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Admiral Group PLC has no effect on the direction of Swedbank i.e., Swedbank and Admiral Group go up and down completely randomly.
Pair Corralation between Swedbank and Admiral Group
Assuming the 90 days trading horizon Swedbank AB ser is expected to generate 0.95 times more return on investment than Admiral Group. However, Swedbank AB ser is 1.06 times less risky than Admiral Group. It trades about 0.19 of its potential returns per unit of risk. Admiral Group PLC is currently generating about -0.11 per unit of risk. If you would invest 27,425 in Swedbank AB ser on September 12, 2025 and sell it today you would earn a total of 3,395 from holding Swedbank AB ser or generate 12.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Swedbank AB ser vs. Admiral Group PLC
Performance |
| Timeline |
| Swedbank AB ser |
| Admiral Group PLC |
Swedbank and Admiral Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swedbank and Admiral Group
The main advantage of trading using opposite Swedbank and Admiral Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swedbank position performs unexpectedly, Admiral 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 Admiral Group will offset losses from the drop in Admiral Group's long position.| Swedbank vs. JB Hunt Transport | Swedbank vs. mobilezone holding AG | Swedbank vs. Zegona Communications Plc | Swedbank vs. Orient Telecoms |
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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