Correlation Between Grieg Seafood and Sligro Food
Can any of the company-specific risk be diversified away by investing in both Grieg Seafood and Sligro Food 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 Sligro Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grieg Seafood and Sligro Food Group, you can compare the effects of market volatilities on Grieg Seafood and Sligro Food 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 Sligro Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grieg Seafood and Sligro Food.
Diversification Opportunities for Grieg Seafood and Sligro Food
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grieg and Sligro is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Grieg Seafood and Sligro Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sligro Food 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 Sligro Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sligro Food Group has no effect on the direction of Grieg Seafood i.e., Grieg Seafood and Sligro Food go up and down completely randomly.
Pair Corralation between Grieg Seafood and Sligro Food
Assuming the 90 days trading horizon Grieg Seafood is expected to generate 1.83 times more return on investment than Sligro Food. However, Grieg Seafood is 1.83 times more volatile than Sligro Food Group. It trades about -0.01 of its potential returns per unit of risk. Sligro Food Group is currently generating about -0.08 per unit of risk. If you would invest 6,417 in Grieg Seafood on August 29, 2024 and sell it today you would lose (649.00) from holding Grieg Seafood or give up 10.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grieg Seafood vs. Sligro Food Group
Performance |
| Timeline |
| Grieg Seafood |
| Sligro Food Group |
Grieg Seafood and Sligro Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grieg Seafood and Sligro Food
The main advantage of trading using opposite Grieg Seafood and Sligro Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grieg Seafood position performs unexpectedly, Sligro Food 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 Sligro Food will offset losses from the drop in Sligro Food's long position.| Grieg Seafood vs. Lendinvest PLC | Grieg Seafood vs. Neometals | Grieg Seafood vs. Coor Service Management | Grieg Seafood vs. Albion Technology General |
| Sligro Food vs. Lendinvest PLC | Sligro Food vs. Neometals | Sligro Food vs. Coor Service Management | Sligro Food vs. Albion Technology General |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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