Correlation Between Grieg Seafood and Beowulf Mining
Can any of the company-specific risk be diversified away by investing in both Grieg Seafood and Beowulf Mining 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 Beowulf Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grieg Seafood and Beowulf Mining, you can compare the effects of market volatilities on Grieg Seafood and Beowulf Mining 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 Beowulf Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grieg Seafood and Beowulf Mining.
Diversification Opportunities for Grieg Seafood and Beowulf Mining
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Grieg and Beowulf is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Grieg Seafood and Beowulf Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beowulf Mining 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 Beowulf Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beowulf Mining has no effect on the direction of Grieg Seafood i.e., Grieg Seafood and Beowulf Mining go up and down completely randomly.
Pair Corralation between Grieg Seafood and Beowulf Mining
Assuming the 90 days trading horizon Grieg Seafood is expected to generate 0.63 times more return on investment than Beowulf Mining. However, Grieg Seafood is 1.6 times less risky than Beowulf Mining. It trades about 0.09 of its potential returns per unit of risk. Beowulf Mining is currently generating about -0.07 per unit of risk. If you would invest 6,625 in Grieg Seafood on November 6, 2024 and sell it today you would earn a total of 820.00 from holding Grieg Seafood or generate 12.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grieg Seafood vs. Beowulf Mining
Performance |
| Timeline |
| Grieg Seafood |
| Beowulf Mining |
Grieg Seafood and Beowulf Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grieg Seafood and Beowulf Mining
The main advantage of trading using opposite Grieg Seafood and Beowulf Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grieg Seafood position performs unexpectedly, Beowulf Mining 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 Beowulf Mining will offset losses from the drop in Beowulf Mining's long position.| Grieg Seafood vs. Samsung Electronics Co | Grieg Seafood vs. Samsung Electronics Co | Grieg Seafood vs. Toyota Motor Corp | Grieg Seafood vs. Reliance Industries Ltd |
| Beowulf Mining vs. Automatic Data Processing | Beowulf Mining vs. Baker Steel Resources | Beowulf Mining vs. Iron Mountain | Beowulf Mining vs. Coor Service Management |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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