Correlation Between Grieg Seafood and Aberdeen Diversified
Can any of the company-specific risk be diversified away by investing in both Grieg Seafood and Aberdeen Diversified 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 Aberdeen Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grieg Seafood and Aberdeen Diversified Income, you can compare the effects of market volatilities on Grieg Seafood and Aberdeen Diversified 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 Aberdeen Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grieg Seafood and Aberdeen Diversified.
Diversification Opportunities for Grieg Seafood and Aberdeen Diversified
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Grieg and Aberdeen is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Grieg Seafood and Aberdeen Diversified Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Diversified 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 Aberdeen Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Diversified has no effect on the direction of Grieg Seafood i.e., Grieg Seafood and Aberdeen Diversified go up and down completely randomly.
Pair Corralation between Grieg Seafood and Aberdeen Diversified
Assuming the 90 days trading horizon Grieg Seafood is expected to generate 2.69 times more return on investment than Aberdeen Diversified. However, Grieg Seafood is 2.69 times more volatile than Aberdeen Diversified Income. It trades about 0.15 of its potential returns per unit of risk. Aberdeen Diversified Income is currently generating about 0.26 per unit of risk. If you would invest 6,168 in Grieg Seafood on October 30, 2024 and sell it today you would earn a total of 535.00 from holding Grieg Seafood or generate 8.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grieg Seafood vs. Aberdeen Diversified Income
Performance |
| Timeline |
| Grieg Seafood |
| Aberdeen Diversified |
Grieg Seafood and Aberdeen Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grieg Seafood and Aberdeen Diversified
The main advantage of trading using opposite Grieg Seafood and Aberdeen Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grieg Seafood position performs unexpectedly, Aberdeen Diversified 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 Aberdeen Diversified will offset losses from the drop in Aberdeen Diversified's long position.| Grieg Seafood vs. First Class Metals | Grieg Seafood vs. MTI Wireless Edge | Grieg Seafood vs. Air Products Chemicals | Grieg Seafood vs. URU Metals |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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