Correlation Between Austevoll Seafood and Hochschild Mining
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Hochschild Mining 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 Hochschild Mining 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 Hochschild Mining plc, you can compare the effects of market volatilities on Austevoll Seafood and Hochschild Mining 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 Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Hochschild Mining.
Diversification Opportunities for Austevoll Seafood and Hochschild Mining
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Austevoll and Hochschild is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc 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 Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Hochschild Mining go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Hochschild Mining
Assuming the 90 days trading horizon Austevoll Seafood is expected to generate 2.02 times less return on investment than Hochschild Mining. But when comparing it to its historical volatility, Austevoll Seafood ASA is 2.24 times less risky than Hochschild Mining. It trades about 0.08 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 17,700 in Hochschild Mining plc on September 21, 2024 and sell it today you would earn a total of 3,900 from holding Hochschild Mining plc or generate 22.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. Hochschild Mining plc
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Hochschild Mining plc |
Austevoll Seafood and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Hochschild Mining
The main advantage of trading using opposite Austevoll Seafood and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Hochschild Mining 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 Hochschild Mining will offset losses from the drop in Hochschild Mining's long position.| Austevoll Seafood vs. Samsung Electronics Co | Austevoll Seafood vs. Samsung Electronics Co | Austevoll Seafood vs. Hyundai Motor | Austevoll Seafood vs. Reliance Industries Ltd |
| Hochschild Mining vs. Cars Inc | Hochschild Mining vs. Austevoll Seafood ASA | Hochschild Mining vs. Baker Steel Resources | Hochschild Mining vs. International Biotechnology Trust |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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