Correlation Between Grieg Seafood and ITV PLC
Can any of the company-specific risk be diversified away by investing in both Grieg Seafood and ITV PLC 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 ITV PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grieg Seafood and ITV PLC, you can compare the effects of market volatilities on Grieg Seafood and ITV PLC 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 ITV PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grieg Seafood and ITV PLC.
Diversification Opportunities for Grieg Seafood and ITV PLC
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grieg and ITV is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Grieg Seafood and ITV PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITV PLC 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 ITV PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITV PLC has no effect on the direction of Grieg Seafood i.e., Grieg Seafood and ITV PLC go up and down completely randomly.
Pair Corralation between Grieg Seafood and ITV PLC
Assuming the 90 days trading horizon Grieg Seafood is expected to generate 10.0 times less return on investment than ITV PLC. In addition to that, Grieg Seafood is 1.21 times more volatile than ITV PLC. It trades about 0.0 of its total potential returns per unit of risk. ITV PLC is currently generating about 0.02 per unit of volatility. If you would invest 6,700 in ITV PLC on September 3, 2024 and sell it today you would earn a total of 565.00 from holding ITV PLC or generate 8.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grieg Seafood vs. ITV PLC
Performance |
| Timeline |
| Grieg Seafood |
| ITV PLC |
Grieg Seafood and ITV PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grieg Seafood and ITV PLC
The main advantage of trading using opposite Grieg Seafood and ITV PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grieg Seafood position performs unexpectedly, ITV PLC 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 ITV PLC will offset losses from the drop in ITV PLC'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 |
| ITV PLC vs. Spirent Communications plc | ITV PLC vs. Aeorema Communications Plc | ITV PLC vs. Litigation Capital Management | ITV PLC vs. Zoom Video Communications |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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