Correlation Between Auction Technology and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both Auction Technology and Austevoll Seafood 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 Auction Technology and Austevoll Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auction Technology Group and Austevoll Seafood ASA, you can compare the effects of market volatilities on Auction Technology and Austevoll Seafood 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 Auction Technology with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auction Technology and Austevoll Seafood.
Diversification Opportunities for Auction Technology and Austevoll Seafood
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Auction and Austevoll is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Auction Technology Group and Austevoll Seafood ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austevoll Seafood ASA and Auction Technology 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 Auction Technology Group are associated (or correlated) with Austevoll Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austevoll Seafood ASA has no effect on the direction of Auction Technology i.e., Auction Technology and Austevoll Seafood go up and down completely randomly.
Pair Corralation between Auction Technology and Austevoll Seafood
Assuming the 90 days trading horizon Auction Technology Group is expected to generate 2.57 times more return on investment than Austevoll Seafood. However, Auction Technology is 2.57 times more volatile than Austevoll Seafood ASA. It trades about 0.17 of its potential returns per unit of risk. Austevoll Seafood ASA is currently generating about 0.09 per unit of risk. If you would invest 41,500 in Auction Technology Group on September 3, 2024 and sell it today you would earn a total of 10,100 from holding Auction Technology Group or generate 24.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auction Technology Group vs. Austevoll Seafood ASA
Performance |
| Timeline |
| Auction Technology |
| Austevoll Seafood ASA |
Auction Technology and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auction Technology and Austevoll Seafood
The main advantage of trading using opposite Auction Technology and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auction Technology position performs unexpectedly, Austevoll Seafood 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 Austevoll Seafood will offset losses from the drop in Austevoll Seafood's long position.| Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Hyundai Motor | Auction Technology vs. Toyota Motor Corp |
| Austevoll Seafood vs. Catalyst Media Group | Austevoll Seafood vs. CATLIN GROUP | Austevoll Seafood vs. Magnora ASA | Austevoll Seafood vs. RTW Venture Fund |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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