Correlation Between Aker Horizons and Everfuel
Can any of the company-specific risk be diversified away by investing in both Aker Horizons and Everfuel 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 Everfuel 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 Everfuel AS, you can compare the effects of market volatilities on Aker Horizons and Everfuel 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 Everfuel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aker Horizons and Everfuel.
Diversification Opportunities for Aker Horizons and Everfuel
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aker and Everfuel is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Aker Horizons AS and Everfuel AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everfuel AS 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 Everfuel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everfuel AS has no effect on the direction of Aker Horizons i.e., Aker Horizons and Everfuel go up and down completely randomly.
Pair Corralation between Aker Horizons and Everfuel
Assuming the 90 days trading horizon Aker Horizons AS is expected to under-perform the Everfuel. But the stock apears to be less risky and, when comparing its historical volatility, Aker Horizons AS is 1.28 times less risky than Everfuel. The stock trades about -0.08 of its potential returns per unit of risk. The Everfuel AS is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 4,235 in Everfuel AS on August 29, 2024 and sell it today you would lose (2,949) from holding Everfuel AS or give up 69.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aker Horizons AS vs. Everfuel AS
Performance |
| Timeline |
| Aker Horizons AS |
| Everfuel AS |
Aker Horizons and Everfuel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aker Horizons and Everfuel
The main advantage of trading using opposite Aker Horizons and Everfuel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aker Horizons position performs unexpectedly, Everfuel 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 Everfuel will offset losses from the drop in Everfuel'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 |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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