Correlation Between Austevoll Seafood and Mitie Group
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Mitie Group 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 Mitie Group 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 Mitie Group PLC, you can compare the effects of market volatilities on Austevoll Seafood and Mitie Group 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 Mitie Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Mitie Group.
Diversification Opportunities for Austevoll Seafood and Mitie Group
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Austevoll and Mitie is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Mitie Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitie Group 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 Mitie Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitie Group PLC has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Mitie Group go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Mitie Group
Assuming the 90 days trading horizon Austevoll Seafood ASA is expected to generate 0.84 times more return on investment than Mitie Group. However, Austevoll Seafood ASA is 1.2 times less risky than Mitie Group. It trades about 0.12 of its potential returns per unit of risk. Mitie Group PLC is currently generating about 0.03 per unit of risk. If you would invest 6,858 in Austevoll Seafood ASA on September 14, 2024 and sell it today you would earn a total of 3,347 from holding Austevoll Seafood ASA or generate 48.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. Mitie Group PLC
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Mitie Group PLC |
Austevoll Seafood and Mitie Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Mitie Group
The main advantage of trading using opposite Austevoll Seafood and Mitie Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Mitie Group 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 Mitie Group will offset losses from the drop in Mitie Group's long position.| Austevoll Seafood vs. The Mercantile Investment | Austevoll Seafood vs. Edita Food Industries | Austevoll Seafood vs. Oakley Capital Investments | Austevoll Seafood vs. Ebro Foods |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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