Correlation Between Grieg Seafood and Waste Management
Can any of the company-specific risk be diversified away by investing in both Grieg Seafood and Waste Management 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 Waste Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grieg Seafood and Waste Management, you can compare the effects of market volatilities on Grieg Seafood and Waste Management 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 Waste Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grieg Seafood and Waste Management.
Diversification Opportunities for Grieg Seafood and Waste Management
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Grieg and Waste is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Grieg Seafood and Waste Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Waste Management 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 Waste Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Waste Management has no effect on the direction of Grieg Seafood i.e., Grieg Seafood and Waste Management go up and down completely randomly.
Pair Corralation between Grieg Seafood and Waste Management
Assuming the 90 days trading horizon Grieg Seafood is expected to generate 2.16 times more return on investment than Waste Management. However, Grieg Seafood is 2.16 times more volatile than Waste Management. It trades about 0.11 of its potential returns per unit of risk. Waste Management is currently generating about 0.03 per unit of risk. If you would invest 5,815 in Grieg Seafood on October 31, 2024 and sell it today you would earn a total of 1,235 from holding Grieg Seafood or generate 21.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.82% |
| Values | Daily Returns |
Grieg Seafood vs. Waste Management
Performance |
| Timeline |
| Grieg Seafood |
| Waste Management |
Grieg Seafood and Waste Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grieg Seafood and Waste Management
The main advantage of trading using opposite Grieg Seafood and Waste Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grieg Seafood position performs unexpectedly, Waste Management 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 Waste Management will offset losses from the drop in Waste Management's long position.| Grieg Seafood vs. SBM Offshore NV | Grieg Seafood vs. Amedeo Air Four | Grieg Seafood vs. Cairo Communication SpA | Grieg Seafood vs. Universal Display Corp |
| Waste Management vs. Sealed Air Corp | Waste Management vs. MTI Wireless Edge | Waste Management vs. Ecclesiastical Insurance Office | Waste Management vs. Eco Animal Health |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |