Correlation Between Grieg Seafood and Leroy Seafood
Can any of the company-specific risk be diversified away by investing in both Grieg Seafood and Leroy Seafood 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 Grieg Seafood and Leroy Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grieg Seafood and Leroy Seafood Group, you can compare the effects of market volatilities on Grieg Seafood and Leroy Seafood 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 Grieg Seafood with a short position of Leroy Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grieg Seafood and Leroy Seafood.
Diversification Opportunities for Grieg Seafood and Leroy Seafood
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grieg and Leroy is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Grieg Seafood and Leroy Seafood Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leroy Seafood Group and Grieg 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 Grieg Seafood are associated (or correlated) with Leroy Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leroy Seafood Group has no effect on the direction of Grieg Seafood i.e., Grieg Seafood and Leroy Seafood go up and down completely randomly.
Pair Corralation between Grieg Seafood and Leroy Seafood
Assuming the 90 days trading horizon Grieg Seafood is expected to under-perform the Leroy Seafood. In addition to that, Grieg Seafood is 1.55 times more volatile than Leroy Seafood Group. It trades about -0.13 of its total potential returns per unit of risk. Leroy Seafood Group is currently generating about 0.06 per unit of volatility. If you would invest 5,084 in Leroy Seafood Group on September 3, 2024 and sell it today you would earn a total of 94.00 from holding Leroy Seafood Group or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grieg Seafood vs. Leroy Seafood Group
Performance |
| Timeline |
| Grieg Seafood |
| Leroy Seafood Group |
Grieg Seafood and Leroy Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grieg Seafood and Leroy Seafood
The main advantage of trading using opposite Grieg Seafood and Leroy Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grieg Seafood position performs unexpectedly, Leroy Seafood 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 Leroy Seafood will offset losses from the drop in Leroy Seafood's long position.| Grieg Seafood vs. Melia Hotels | Grieg Seafood vs. Capital Metals PLC | Grieg Seafood vs. Golden Metal Resources | Grieg Seafood vs. PPHE Hotel Group |
| Leroy Seafood vs. GlobalData PLC | Leroy Seafood vs. Evolution Gaming Group | Leroy Seafood vs. New Residential Investment | Leroy Seafood vs. FC Investment 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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