Correlation Between Danske Bank and Hang Seng
Can any of the company-specific risk be diversified away by investing in both Danske Bank and Hang Seng 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 Hang Seng 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 Hang Seng Bank, you can compare the effects of market volatilities on Danske Bank and Hang Seng 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 Hang Seng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Danske Bank and Hang Seng.
Diversification Opportunities for Danske Bank and Hang Seng
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Danske and Hang is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Danske Bank AS and Hang Seng Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hang Seng Bank 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 Hang Seng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hang Seng Bank has no effect on the direction of Danske Bank i.e., Danske Bank and Hang Seng go up and down completely randomly.
Pair Corralation between Danske Bank and Hang Seng
Assuming the 90 days horizon Danske Bank is expected to generate 9.72 times less return on investment than Hang Seng. But when comparing it to its historical volatility, Danske Bank AS is 1.74 times less risky than Hang Seng. It trades about 0.03 of its potential returns per unit of risk. Hang Seng Bank is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,535 in Hang Seng Bank on September 6, 2025 and sell it today you would earn a total of 395.00 from holding Hang Seng Bank or generate 25.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Danske Bank AS vs. Hang Seng Bank
Performance |
| Timeline |
| Danske Bank AS |
| Hang Seng Bank |
Danske Bank and Hang Seng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Danske Bank and Hang Seng
The main advantage of trading using opposite Danske Bank and Hang Seng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Danske Bank position performs unexpectedly, Hang Seng 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 Hang Seng will offset losses from the drop in Hang Seng's long position.| Danske Bank vs. Uber Technologies | Danske Bank vs. NXP Semiconductors NV | Danske Bank vs. Luckin Coffee | Danske Bank vs. Schweiter Technologies AG |
| Hang Seng vs. MagnaChip Semiconductor | Hang Seng vs. Newron Sport | Hang Seng vs. BE Semiconductor Industries | Hang Seng vs. Canlan Ice Sports |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |