Correlation Between Austevoll Seafood and Avi
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Avi 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 Austevoll Seafood and Avi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Austevoll Seafood ASA and Avi Ltd ADR, you can compare the effects of market volatilities on Austevoll Seafood and Avi 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 Austevoll Seafood with a short position of Avi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Avi.
Diversification Opportunities for Austevoll Seafood and Avi
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Austevoll and Avi is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Avi Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avi Ltd ADR and Austevoll Seafood 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 Austevoll Seafood ASA are associated (or correlated) with Avi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avi Ltd ADR has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Avi go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Avi
Assuming the 90 days horizon Austevoll Seafood is expected to generate 22.35 times less return on investment than Avi. But when comparing it to its historical volatility, Austevoll Seafood ASA is 4.76 times less risky than Avi. It trades about 0.01 of its potential returns per unit of risk. Avi Ltd ADR is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,453 in Avi Ltd ADR on August 24, 2024 and sell it today you would earn a total of 871.00 from holding Avi Ltd ADR or generate 35.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 84.99% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. Avi Ltd ADR
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Avi Ltd ADR |
Austevoll Seafood and Avi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Avi
The main advantage of trading using opposite Austevoll Seafood and Avi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Avi 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 Avi will offset losses from the drop in Avi's long position.| Austevoll Seafood vs. Avi Ltd ADR | Austevoll Seafood vs. Altavoz Entertainment | Austevoll Seafood vs. The a2 Milk | Austevoll Seafood vs. Aryzta AG PK |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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