Correlation Between Aker Horizons and American Shipping
Can any of the company-specific risk be diversified away by investing in both Aker Horizons and American Shipping 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 Aker Horizons and American Shipping into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aker Horizons AS and American Shipping, you can compare the effects of market volatilities on Aker Horizons and American Shipping 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 Aker Horizons with a short position of American Shipping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aker Horizons and American Shipping.
Diversification Opportunities for Aker Horizons and American Shipping
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aker and American is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Aker Horizons AS and American Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Shipping and Aker Horizons 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 Aker Horizons AS are associated (or correlated) with American Shipping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Shipping has no effect on the direction of Aker Horizons i.e., Aker Horizons and American Shipping go up and down completely randomly.
Pair Corralation between Aker Horizons and American Shipping
Assuming the 90 days trading horizon Aker Horizons AS is expected to under-perform the American Shipping. In addition to that, Aker Horizons is 3.13 times more volatile than American Shipping. It trades about -0.21 of its total potential returns per unit of risk. American Shipping is currently generating about -0.03 per unit of volatility. If you would invest 2,803 in American Shipping on September 1, 2024 and sell it today you would lose (38.00) from holding American Shipping or give up 1.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Aker Horizons AS vs. American Shipping
Performance |
| Timeline |
| Aker Horizons AS |
| American Shipping |
Aker Horizons and American Shipping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aker Horizons and American Shipping
The main advantage of trading using opposite Aker Horizons and American Shipping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aker Horizons position performs unexpectedly, American Shipping 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 American Shipping will offset losses from the drop in American Shipping's long position.| Aker Horizons vs. Aker Carbon Capture | Aker Horizons vs. REC Silicon ASA | Aker Horizons vs. Aker Solutions ASA | Aker Horizons vs. Aker BP ASA |
| American Shipping vs. Aker Horizons AS | American Shipping vs. REC Silicon ASA | American Shipping vs. Kongsberg Automotive Holding | American Shipping vs. Aker Carbon Capture |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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