Correlation Between Austevoll Seafood and NatWest Group
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and NatWest 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 NatWest 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 NatWest Group PLC, you can compare the effects of market volatilities on Austevoll Seafood and NatWest 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 NatWest Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and NatWest Group.
Diversification Opportunities for Austevoll Seafood and NatWest Group
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Austevoll and NatWest is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and NatWest Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NatWest 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 NatWest Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NatWest Group PLC has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and NatWest Group go up and down completely randomly.
Pair Corralation between Austevoll Seafood and NatWest Group
Assuming the 90 days trading horizon Austevoll Seafood ASA is expected to generate 0.67 times more return on investment than NatWest Group. However, Austevoll Seafood ASA is 1.49 times less risky than NatWest Group. It trades about 0.35 of its potential returns per unit of risk. NatWest Group PLC is currently generating about 0.14 per unit of risk. If you would invest 9,728 in Austevoll Seafood ASA on October 25, 2024 and sell it today you would earn a total of 802.00 from holding Austevoll Seafood ASA or generate 8.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. NatWest Group PLC
Performance |
| Timeline |
| Austevoll Seafood ASA |
| NatWest Group PLC |
Austevoll Seafood and NatWest Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and NatWest Group
The main advantage of trading using opposite Austevoll Seafood and NatWest Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, NatWest 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 NatWest Group will offset losses from the drop in NatWest Group's long position.| Austevoll Seafood vs. BE Semiconductor Industries | Austevoll Seafood vs. Young Cos Brewery | Austevoll Seafood vs. Nordic Semiconductor ASA | Austevoll Seafood vs. Teradata Corp |
| NatWest Group vs. Premier Foods PLC | NatWest Group vs. Austevoll Seafood ASA | NatWest Group vs. Summit Materials Cl | NatWest Group vs. Tyson Foods Cl |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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