Correlation Between Austevoll Seafood and Lery Seafood
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Lery 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 Austevoll Seafood and Lery Seafood 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 Lery Seafood Group, you can compare the effects of market volatilities on Austevoll Seafood and Lery 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 Austevoll Seafood with a short position of Lery Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Lery Seafood.
Diversification Opportunities for Austevoll Seafood and Lery Seafood
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Austevoll and Lery is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Lery Seafood Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lery Seafood Group 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 Lery Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lery Seafood Group has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Lery Seafood go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Lery Seafood
Assuming the 90 days trading horizon Austevoll Seafood ASA is expected to generate 0.84 times more return on investment than Lery Seafood. However, Austevoll Seafood ASA is 1.19 times less risky than Lery Seafood. It trades about 0.08 of its potential returns per unit of risk. Lery Seafood Group is currently generating about 0.05 per unit of risk. If you would invest 8,827 in Austevoll Seafood ASA on August 25, 2024 and sell it today you would earn a total of 1,263 from holding Austevoll Seafood ASA or generate 14.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. Lery Seafood Group
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Lery Seafood Group |
Austevoll Seafood and Lery Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Lery Seafood
The main advantage of trading using opposite Austevoll Seafood and Lery Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Lery 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 Lery Seafood will offset losses from the drop in Lery Seafood's long position.| Austevoll Seafood vs. Grieg Seafood ASA | Austevoll Seafood vs. SalMar ASA | Austevoll Seafood vs. Pf Bakkafrost | Austevoll Seafood vs. Mowi ASA |
| Lery Seafood vs. Grieg Seafood ASA | Lery Seafood vs. SalMar ASA | Lery Seafood vs. Pf Bakkafrost | Lery Seafood vs. Mowi 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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