Correlation Between Aker Solutions and Arribatec Solutions
Can any of the company-specific risk be diversified away by investing in both Aker Solutions and Arribatec Solutions 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 Solutions and Arribatec Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aker Solutions ASA and Arribatec Solutions ASA, you can compare the effects of market volatilities on Aker Solutions and Arribatec Solutions 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 Solutions with a short position of Arribatec Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aker Solutions and Arribatec Solutions.
Diversification Opportunities for Aker Solutions and Arribatec Solutions
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aker and Arribatec is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Aker Solutions ASA and Arribatec Solutions ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arribatec Solutions ASA and Aker Solutions 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 Solutions ASA are associated (or correlated) with Arribatec Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arribatec Solutions ASA has no effect on the direction of Aker Solutions i.e., Aker Solutions and Arribatec Solutions go up and down completely randomly.
Pair Corralation between Aker Solutions and Arribatec Solutions
Assuming the 90 days trading horizon Aker Solutions ASA is expected to generate 0.31 times more return on investment than Arribatec Solutions. However, Aker Solutions ASA is 3.22 times less risky than Arribatec Solutions. It trades about 0.06 of its potential returns per unit of risk. Arribatec Solutions ASA is currently generating about -0.07 per unit of risk. If you would invest 2,657 in Aker Solutions ASA on September 1, 2024 and sell it today you would earn a total of 489.00 from holding Aker Solutions ASA or generate 18.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aker Solutions ASA vs. Arribatec Solutions ASA
Performance |
| Timeline |
| Aker Solutions ASA |
| Arribatec Solutions ASA |
Aker Solutions and Arribatec Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aker Solutions and Arribatec Solutions
The main advantage of trading using opposite Aker Solutions and Arribatec Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aker Solutions position performs unexpectedly, Arribatec Solutions 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 Arribatec Solutions will offset losses from the drop in Arribatec Solutions' long position.| Aker Solutions vs. Aker ASA | Aker Solutions vs. Subsea 7 SA | Aker Solutions vs. TGS NOPEC Geophysical | Aker Solutions vs. BW Offshore |
| Arribatec Solutions vs. Next Biometrics Group | Arribatec Solutions vs. Endur ASA | Arribatec Solutions vs. Saga Pure ASA | Arribatec Solutions vs. Idex 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |