Correlation Between ADS Maritime and Instabank ASA
Can any of the company-specific risk be diversified away by investing in both ADS Maritime and Instabank ASA 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 ADS Maritime and Instabank ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADS Maritime Holding and Instabank ASA, you can compare the effects of market volatilities on ADS Maritime and Instabank ASA 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 ADS Maritime with a short position of Instabank ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADS Maritime and Instabank ASA.
Diversification Opportunities for ADS Maritime and Instabank ASA
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between ADS and Instabank is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding ADS Maritime Holding and Instabank ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Instabank ASA and ADS Maritime 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 ADS Maritime Holding are associated (or correlated) with Instabank ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Instabank ASA has no effect on the direction of ADS Maritime i.e., ADS Maritime and Instabank ASA go up and down completely randomly.
Pair Corralation between ADS Maritime and Instabank ASA
Assuming the 90 days trading horizon ADS Maritime Holding is expected to under-perform the Instabank ASA. In addition to that, ADS Maritime is 2.44 times more volatile than Instabank ASA. It trades about -0.01 of its total potential returns per unit of risk. Instabank ASA is currently generating about 0.03 per unit of volatility. If you would invest 194.00 in Instabank ASA on September 3, 2024 and sell it today you would earn a total of 1.00 from holding Instabank ASA or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ADS Maritime Holding vs. Instabank ASA
Performance |
| Timeline |
| ADS Maritime Holding |
| Instabank ASA |
ADS Maritime and Instabank ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADS Maritime and Instabank ASA
The main advantage of trading using opposite ADS Maritime and Instabank ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADS Maritime position performs unexpectedly, Instabank ASA 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 Instabank ASA will offset losses from the drop in Instabank ASA's long position.| ADS Maritime vs. Havila Shipping ASA | ADS Maritime vs. Shelf Drilling | ADS Maritime vs. Solstad Offsho | ADS Maritime vs. Eidesvik Offshore ASA |
| Instabank ASA vs. SD Standard Drilling | Instabank ASA vs. Gaming Innovation Group | Instabank ASA vs. Eidesvik Offshore ASA | Instabank ASA vs. Norwegian Air Shuttle |
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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