Correlation Between Austevoll Seafood and Dalata Hotel
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Dalata Hotel 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 Austevoll Seafood and Dalata Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Austevoll Seafood ASA and Dalata Hotel Group, you can compare the effects of market volatilities on Austevoll Seafood and Dalata Hotel 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 Austevoll Seafood with a short position of Dalata Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Dalata Hotel.
Diversification Opportunities for Austevoll Seafood and Dalata Hotel
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Austevoll and Dalata is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Dalata Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dalata Hotel Group and Austevoll Seafood 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 Austevoll Seafood ASA are associated (or correlated) with Dalata Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dalata Hotel Group has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Dalata Hotel go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Dalata Hotel
Assuming the 90 days trading horizon Austevoll Seafood is expected to generate 1.21 times less return on investment than Dalata Hotel. But when comparing it to its historical volatility, Austevoll Seafood ASA is 1.53 times less risky than Dalata Hotel. It trades about 0.22 of its potential returns per unit of risk. Dalata Hotel Group is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 35,100 in Dalata Hotel Group on September 4, 2024 and sell it today you would earn a total of 2,400 from holding Dalata Hotel Group or generate 6.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. Dalata Hotel Group
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Dalata Hotel Group |
Austevoll Seafood and Dalata Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Dalata Hotel
The main advantage of trading using opposite Austevoll Seafood and Dalata Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Dalata Hotel 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 Dalata Hotel will offset losses from the drop in Dalata Hotel's long position.| Austevoll Seafood vs. Samsung Electronics Co | Austevoll Seafood vs. Samsung Electronics Co | Austevoll Seafood vs. Hyundai Motor | Austevoll Seafood vs. Toyota Motor Corp |
| Dalata Hotel vs. BYD Co | Dalata Hotel vs. Volkswagen AG | Dalata Hotel vs. Volkswagen AG Non Vtg | Dalata Hotel vs. Compass Group PLC |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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