Correlation Between Cellnex Telecom and Grieg Seafood
Can any of the company-specific risk be diversified away by investing in both Cellnex Telecom and Grieg Seafood 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 Cellnex Telecom and Grieg Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cellnex Telecom SA and Grieg Seafood, you can compare the effects of market volatilities on Cellnex Telecom and Grieg Seafood 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 Cellnex Telecom with a short position of Grieg Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cellnex Telecom and Grieg Seafood.
Diversification Opportunities for Cellnex Telecom and Grieg Seafood
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cellnex and Grieg is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Cellnex Telecom SA and Grieg Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grieg Seafood and Cellnex Telecom 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 Cellnex Telecom SA are associated (or correlated) with Grieg Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grieg Seafood has no effect on the direction of Cellnex Telecom i.e., Cellnex Telecom and Grieg Seafood go up and down completely randomly.
Pair Corralation between Cellnex Telecom and Grieg Seafood
Assuming the 90 days trading horizon Cellnex Telecom is expected to generate 2.9 times less return on investment than Grieg Seafood. But when comparing it to its historical volatility, Cellnex Telecom SA is 1.69 times less risky than Grieg Seafood. It trades about 0.05 of its potential returns per unit of risk. Grieg Seafood is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 6,451 in Grieg Seafood on September 13, 2024 and sell it today you would earn a total of 244.00 from holding Grieg Seafood or generate 3.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cellnex Telecom SA vs. Grieg Seafood
Performance |
| Timeline |
| Cellnex Telecom SA |
| Grieg Seafood |
Cellnex Telecom and Grieg Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cellnex Telecom and Grieg Seafood
The main advantage of trading using opposite Cellnex Telecom and Grieg Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cellnex Telecom position performs unexpectedly, Grieg Seafood 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 Grieg Seafood will offset losses from the drop in Grieg Seafood's long position.| Cellnex Telecom vs. Samsung Electronics Co | Cellnex Telecom vs. Samsung Electronics Co | Cellnex Telecom vs. Hyundai Motor | Cellnex Telecom vs. Reliance Industries Ltd |
| Grieg Seafood vs. Samsung Electronics Co | Grieg Seafood vs. Samsung Electronics Co | Grieg Seafood vs. Hyundai Motor | Grieg Seafood vs. Reliance Industries Ltd |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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