Correlation Between DFDS AS and AWILCO LNG
Can any of the company-specific risk be diversified away by investing in both DFDS AS and AWILCO LNG 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 DFDS AS and AWILCO LNG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DFDS AS and AWILCO LNG NK, you can compare the effects of market volatilities on DFDS AS and AWILCO LNG 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 DFDS AS with a short position of AWILCO LNG. Check out your portfolio center. Please also check ongoing floating volatility patterns of DFDS AS and AWILCO LNG.
Diversification Opportunities for DFDS AS and AWILCO LNG
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between DFDS and AWILCO is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding DFDS AS and AWILCO LNG NK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AWILCO LNG NK and DFDS AS 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 DFDS AS are associated (or correlated) with AWILCO LNG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AWILCO LNG NK has no effect on the direction of DFDS AS i.e., DFDS AS and AWILCO LNG go up and down completely randomly.
Pair Corralation between DFDS AS and AWILCO LNG
Assuming the 90 days horizon DFDS AS is expected to generate 0.34 times more return on investment than AWILCO LNG. However, DFDS AS is 2.91 times less risky than AWILCO LNG. It trades about 0.1 of its potential returns per unit of risk. AWILCO LNG NK is currently generating about -0.22 per unit of risk. If you would invest 1,847 in DFDS AS on September 13, 2024 and sell it today you would earn a total of 82.00 from holding DFDS AS or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
DFDS AS vs. AWILCO LNG NK
Performance |
| Timeline |
| DFDS AS |
| AWILCO LNG NK |
DFDS AS and AWILCO LNG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DFDS AS and AWILCO LNG
The main advantage of trading using opposite DFDS AS and AWILCO LNG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DFDS AS position performs unexpectedly, AWILCO LNG 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 AWILCO LNG will offset losses from the drop in AWILCO LNG's long position.| DFDS AS vs. ZURICH INSURANCE GROUP | DFDS AS vs. SBI Insurance Group | DFDS AS vs. Universal Insurance Holdings | DFDS AS vs. Harmony Gold Mining |
| AWILCO LNG vs. ALTAIR RES INC | AWILCO LNG vs. HF SINCLAIR P | AWILCO LNG vs. REGAL ASIAN INVESTMENTS | AWILCO LNG vs. Altair Engineering |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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