Correlation Between Aryzta AG and SalMar ASA
Can any of the company-specific risk be diversified away by investing in both Aryzta AG and SalMar 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 Aryzta AG and SalMar ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aryzta AG PK and SalMar ASA, you can compare the effects of market volatilities on Aryzta AG and SalMar 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 Aryzta AG with a short position of SalMar ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aryzta AG and SalMar ASA.
Diversification Opportunities for Aryzta AG and SalMar ASA
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aryzta and SalMar is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Aryzta AG PK and SalMar ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SalMar ASA and Aryzta AG 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 Aryzta AG PK are associated (or correlated) with SalMar ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SalMar ASA has no effect on the direction of Aryzta AG i.e., Aryzta AG and SalMar ASA go up and down completely randomly.
Pair Corralation between Aryzta AG and SalMar ASA
Assuming the 90 days horizon Aryzta AG is expected to generate 1.43 times less return on investment than SalMar ASA. In addition to that, Aryzta AG is 1.13 times more volatile than SalMar ASA. It trades about 0.13 of its total potential returns per unit of risk. SalMar ASA is currently generating about 0.21 per unit of volatility. If you would invest 4,600 in SalMar ASA on December 1, 2024 and sell it today you would earn a total of 804.00 from holding SalMar ASA or generate 17.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Aryzta AG PK vs. SalMar ASA
Performance |
| Timeline |
| Aryzta AG PK |
| SalMar ASA |
Aryzta AG and SalMar ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aryzta AG and SalMar ASA
The main advantage of trading using opposite Aryzta AG and SalMar ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aryzta AG position performs unexpectedly, SalMar 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 SalMar ASA will offset losses from the drop in SalMar ASA's long position.| Aryzta AG vs. Artisan Consumer Goods | Aryzta AG vs. Altavoz Entertainment | Aryzta AG vs. Avi Ltd ADR | Aryzta AG vs. The a2 Milk |
| SalMar ASA vs. Austevoll Seafood ASA | SalMar ASA vs. Golden Agri Resources | SalMar ASA vs. SalMar ASA | SalMar ASA vs. Wilmar International |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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