Correlation Between Atlantic Sapphire and Salmon Evolution
Can any of the company-specific risk be diversified away by investing in both Atlantic Sapphire and Salmon Evolution 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 Atlantic Sapphire and Salmon Evolution into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlantic Sapphire As and Salmon Evolution Holding, you can compare the effects of market volatilities on Atlantic Sapphire and Salmon Evolution 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 Atlantic Sapphire with a short position of Salmon Evolution. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlantic Sapphire and Salmon Evolution.
Diversification Opportunities for Atlantic Sapphire and Salmon Evolution
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Atlantic and Salmon is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Atlantic Sapphire As and Salmon Evolution Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salmon Evolution Holding and Atlantic Sapphire 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 Atlantic Sapphire As are associated (or correlated) with Salmon Evolution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salmon Evolution Holding has no effect on the direction of Atlantic Sapphire i.e., Atlantic Sapphire and Salmon Evolution go up and down completely randomly.
Pair Corralation between Atlantic Sapphire and Salmon Evolution
Assuming the 90 days trading horizon Atlantic Sapphire As is expected to under-perform the Salmon Evolution. In addition to that, Atlantic Sapphire is 3.88 times more volatile than Salmon Evolution Holding. It trades about -0.12 of its total potential returns per unit of risk. Salmon Evolution Holding is currently generating about -0.2 per unit of volatility. If you would invest 707.00 in Salmon Evolution Holding on November 27, 2024 and sell it today you would lose (50.00) from holding Salmon Evolution Holding or give up 7.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlantic Sapphire As vs. Salmon Evolution Holding
Performance |
| Timeline |
| Atlantic Sapphire |
| Salmon Evolution Holding |
Atlantic Sapphire and Salmon Evolution Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlantic Sapphire and Salmon Evolution
The main advantage of trading using opposite Atlantic Sapphire and Salmon Evolution positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlantic Sapphire position performs unexpectedly, Salmon Evolution 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 Salmon Evolution will offset losses from the drop in Salmon Evolution's long position.| Atlantic Sapphire vs. Grieg Seafood ASA | Atlantic Sapphire vs. Mowi ASA | Atlantic Sapphire vs. SalMar ASA | Atlantic Sapphire vs. Pf Bakkafrost |
| Salmon Evolution vs. Melhus Sparebank | Salmon Evolution vs. Romsdal Sparebank | Salmon Evolution vs. Aurskog Sparebank | Salmon Evolution vs. Helgeland Sparebank |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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