Correlation Between Telenor ASA and Pexip Holding
Can any of the company-specific risk be diversified away by investing in both Telenor ASA and Pexip Holding 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 Telenor ASA and Pexip Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telenor ASA and Pexip Holding ASA, you can compare the effects of market volatilities on Telenor ASA and Pexip Holding 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 Telenor ASA with a short position of Pexip Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telenor ASA and Pexip Holding.
Diversification Opportunities for Telenor ASA and Pexip Holding
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Telenor and Pexip is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Telenor ASA and Pexip Holding ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pexip Holding ASA and Telenor ASA 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 Telenor ASA are associated (or correlated) with Pexip Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pexip Holding ASA has no effect on the direction of Telenor ASA i.e., Telenor ASA and Pexip Holding go up and down completely randomly.
Pair Corralation between Telenor ASA and Pexip Holding
Assuming the 90 days trading horizon Telenor ASA is expected to generate 7.22 times less return on investment than Pexip Holding. But when comparing it to its historical volatility, Telenor ASA is 2.23 times less risky than Pexip Holding. It trades about 0.09 of its potential returns per unit of risk. Pexip Holding ASA is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 3,980 in Pexip Holding ASA on March 19, 2025 and sell it today you would earn a total of 2,180 from holding Pexip Holding ASA or generate 54.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.31% |
| Values | Daily Returns |
Telenor ASA vs. Pexip Holding ASA
Performance |
| Timeline |
| Telenor ASA |
| Pexip Holding ASA |
Telenor ASA and Pexip Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telenor ASA and Pexip Holding
The main advantage of trading using opposite Telenor ASA and Pexip Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telenor ASA position performs unexpectedly, Pexip Holding 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 Pexip Holding will offset losses from the drop in Pexip Holding's long position.| Telenor ASA vs. Orkla ASA | Telenor ASA vs. DnB ASA | Telenor ASA vs. Yara International ASA | Telenor ASA vs. Storebrand ASA |
| Pexip Holding vs. XXL ASA | Pexip Holding vs. Nordic Semiconductor ASA | Pexip Holding vs. Aker Horizons AS | Pexip Holding vs. Atlantic Sapphire As |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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