Correlation Between SIVERS SEMICONDUCTORS and PF Bakkafrost
Can any of the company-specific risk be diversified away by investing in both SIVERS SEMICONDUCTORS and PF Bakkafrost 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 SIVERS SEMICONDUCTORS and PF Bakkafrost into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIVERS SEMICONDUCTORS AB and PF Bakkafrost, you can compare the effects of market volatilities on SIVERS SEMICONDUCTORS and PF Bakkafrost 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 SIVERS SEMICONDUCTORS with a short position of PF Bakkafrost. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIVERS SEMICONDUCTORS and PF Bakkafrost.
Diversification Opportunities for SIVERS SEMICONDUCTORS and PF Bakkafrost
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SIVERS and 6BF is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and PF Bakkafrost in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PF Bakkafrost and SIVERS SEMICONDUCTORS 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 SIVERS SEMICONDUCTORS AB are associated (or correlated) with PF Bakkafrost. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PF Bakkafrost has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and PF Bakkafrost go up and down completely randomly.
Pair Corralation between SIVERS SEMICONDUCTORS and PF Bakkafrost
Assuming the 90 days horizon SIVERS SEMICONDUCTORS AB is expected to generate 5.67 times more return on investment than PF Bakkafrost. However, SIVERS SEMICONDUCTORS is 5.67 times more volatile than PF Bakkafrost. It trades about 0.25 of its potential returns per unit of risk. PF Bakkafrost is currently generating about 0.08 per unit of risk. If you would invest 16.00 in SIVERS SEMICONDUCTORS AB on September 19, 2024 and sell it today you would earn a total of 9.00 from holding SIVERS SEMICONDUCTORS AB or generate 56.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIVERS SEMICONDUCTORS AB vs. PF Bakkafrost
Performance |
| Timeline |
| SIVERS SEMICONDUCTORS |
| PF Bakkafrost |
SIVERS SEMICONDUCTORS and PF Bakkafrost Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIVERS SEMICONDUCTORS and PF Bakkafrost
The main advantage of trading using opposite SIVERS SEMICONDUCTORS and PF Bakkafrost positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIVERS SEMICONDUCTORS position performs unexpectedly, PF Bakkafrost 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 PF Bakkafrost will offset losses from the drop in PF Bakkafrost's long position.| SIVERS SEMICONDUCTORS vs. Taiwan Semiconductor Manufacturing | SIVERS SEMICONDUCTORS vs. Broadcom | SIVERS SEMICONDUCTORS vs. Superior Plus Corp | SIVERS SEMICONDUCTORS vs. Norsk Hydro ASA |
| PF Bakkafrost vs. Metro AG | PF Bakkafrost vs. Superior Plus Corp | PF Bakkafrost vs. SIVERS SEMICONDUCTORS AB | PF Bakkafrost vs. NorAm Drilling AS |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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