Correlation Between Austevoll Seafood and Aurskog Sparebank
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Aurskog Sparebank 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 Aurskog Sparebank 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 Aurskog Sparebank, you can compare the effects of market volatilities on Austevoll Seafood and Aurskog Sparebank 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 Aurskog Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Aurskog Sparebank.
Diversification Opportunities for Austevoll Seafood and Aurskog Sparebank
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Austevoll and Aurskog is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Aurskog Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurskog Sparebank 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 Aurskog Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurskog Sparebank has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Aurskog Sparebank go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Aurskog Sparebank
Assuming the 90 days trading horizon Austevoll Seafood ASA is expected to generate 1.67 times more return on investment than Aurskog Sparebank. However, Austevoll Seafood is 1.67 times more volatile than Aurskog Sparebank. It trades about 0.03 of its potential returns per unit of risk. Aurskog Sparebank is currently generating about 0.05 per unit of risk. If you would invest 8,469 in Austevoll Seafood ASA on August 29, 2024 and sell it today you would earn a total of 1,531 from holding Austevoll Seafood ASA or generate 18.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. Aurskog Sparebank
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Aurskog Sparebank |
Austevoll Seafood and Aurskog Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Aurskog Sparebank
The main advantage of trading using opposite Austevoll Seafood and Aurskog Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Aurskog Sparebank 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 Aurskog Sparebank will offset losses from the drop in Aurskog Sparebank's long position.| Austevoll Seafood vs. Lery Seafood Group | Austevoll Seafood vs. Grieg Seafood ASA | Austevoll Seafood vs. SalMar ASA | Austevoll Seafood vs. Pf Bakkafrost |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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