Correlation Between Danske Bank and Bank Rakyat
Can any of the company-specific risk be diversified away by investing in both Danske Bank and Bank Rakyat 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 Danske Bank and Bank Rakyat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Danske Bank AS and Bank Rakyat, you can compare the effects of market volatilities on Danske Bank and Bank Rakyat 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 Danske Bank with a short position of Bank Rakyat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Danske Bank and Bank Rakyat.
Diversification Opportunities for Danske Bank and Bank Rakyat
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Danske and Bank is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Danske Bank AS and Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Rakyat and Danske 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 Danske Bank AS are associated (or correlated) with Bank Rakyat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Rakyat has no effect on the direction of Danske Bank i.e., Danske Bank and Bank Rakyat go up and down completely randomly.
Pair Corralation between Danske Bank and Bank Rakyat
Assuming the 90 days horizon Danske Bank AS is expected to generate 0.73 times more return on investment than Bank Rakyat. However, Danske Bank AS is 1.36 times less risky than Bank Rakyat. It trades about 0.12 of its potential returns per unit of risk. Bank Rakyat is currently generating about -0.06 per unit of risk. If you would invest 4,091 in Danske Bank AS on August 18, 2025 and sell it today you would earn a total of 469.00 from holding Danske Bank AS or generate 11.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Danske Bank AS vs. Bank Rakyat
Performance |
| Timeline |
| Danske Bank AS |
| Bank Rakyat |
Danske Bank and Bank Rakyat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Danske Bank and Bank Rakyat
The main advantage of trading using opposite Danske Bank and Bank Rakyat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Danske Bank position performs unexpectedly, Bank Rakyat 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 Bank Rakyat will offset losses from the drop in Bank Rakyat's long position.| Danske Bank vs. Skandinaviska Enskilda Banken | Danske Bank vs. Bank Rakyat | Danske Bank vs. DNB Bank ASA | Danske Bank vs. Swedbank AB |
| Bank Rakyat vs. Erste Group Bank | Bank Rakyat vs. Postal Savings Bank | Bank Rakyat vs. Lloyds Banking Group | Bank Rakyat vs. ING Groep NV |
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.
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