Correlation Between Arribatec Solutions and Crayon Group
Can any of the company-specific risk be diversified away by investing in both Arribatec Solutions and Crayon Group 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 Arribatec Solutions and Crayon Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arribatec Solutions ASA and Crayon Group Holding, you can compare the effects of market volatilities on Arribatec Solutions and Crayon Group 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 Arribatec Solutions with a short position of Crayon Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arribatec Solutions and Crayon Group.
Diversification Opportunities for Arribatec Solutions and Crayon Group
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Arribatec and Crayon is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Arribatec Solutions ASA and Crayon Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crayon Group Holding and Arribatec 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 Arribatec Solutions ASA are associated (or correlated) with Crayon Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crayon Group Holding has no effect on the direction of Arribatec Solutions i.e., Arribatec Solutions and Crayon Group go up and down completely randomly.
Pair Corralation between Arribatec Solutions and Crayon Group
Assuming the 90 days trading horizon Arribatec Solutions ASA is expected to under-perform the Crayon Group. In addition to that, Arribatec Solutions is 2.14 times more volatile than Crayon Group Holding. It trades about -0.03 of its total potential returns per unit of risk. Crayon Group Holding is currently generating about 0.03 per unit of volatility. If you would invest 9,285 in Crayon Group Holding on November 2, 2024 and sell it today you would earn a total of 3,105 from holding Crayon Group Holding or generate 33.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arribatec Solutions ASA vs. Crayon Group Holding
Performance |
| Timeline |
| Arribatec Solutions ASA |
| Crayon Group Holding |
Arribatec Solutions and Crayon Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arribatec Solutions and Crayon Group
The main advantage of trading using opposite Arribatec Solutions and Crayon Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arribatec Solutions position performs unexpectedly, Crayon Group 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 Crayon Group will offset losses from the drop in Crayon Group's long position.| Arribatec Solutions vs. Next Biometrics Group | Arribatec Solutions vs. Endur ASA | Arribatec Solutions vs. Saga Pure ASA | Arribatec Solutions vs. Idex ASA |
| Crayon Group vs. Zaptec AS | Crayon Group vs. Nordic Semiconductor ASA | Crayon Group vs. Scatec Solar OL | Crayon Group vs. Kitron 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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