Correlation Between Atea ASA and Argeo AS
Can any of the company-specific risk be diversified away by investing in both Atea ASA and Argeo AS 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 Atea ASA and Argeo AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atea ASA and Argeo AS, you can compare the effects of market volatilities on Atea ASA and Argeo AS 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 Atea ASA with a short position of Argeo AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atea ASA and Argeo AS.
Diversification Opportunities for Atea ASA and Argeo AS
Very good diversification
The 3 months correlation between Atea and Argeo is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Atea ASA and Argeo AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argeo AS and Atea ASA 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 Atea ASA are associated (or correlated) with Argeo AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argeo AS has no effect on the direction of Atea ASA i.e., Atea ASA and Argeo AS go up and down completely randomly.
Pair Corralation between Atea ASA and Argeo AS
Assuming the 90 days trading horizon Atea ASA is expected to generate 0.27 times more return on investment than Argeo AS. However, Atea ASA is 3.77 times less risky than Argeo AS. It trades about -0.02 of its potential returns per unit of risk. Argeo AS is currently generating about -0.09 per unit of risk. If you would invest 13,712 in Atea ASA on September 1, 2024 and sell it today you would lose (132.00) from holding Atea ASA or give up 0.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Atea ASA vs. Argeo AS
Performance |
| Timeline |
| Atea ASA |
| Argeo AS |
Atea ASA and Argeo AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atea ASA and Argeo AS
The main advantage of trading using opposite Atea ASA and Argeo AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atea ASA position performs unexpectedly, Argeo AS 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 Argeo AS will offset losses from the drop in Argeo AS's long position.| Atea ASA vs. Idex ASA | Atea ASA vs. XXL ASA | Atea ASA vs. Bergenbio ASA | Atea ASA vs. Precise Biometrics AB |
| Argeo AS vs. Nordic Unmanned As | Argeo AS vs. Carasent ASA | Argeo AS vs. Aega ASA | Argeo AS vs. Magnora 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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