Correlation Between Bergenbio ASA and Aega ASA
Can any of the company-specific risk be diversified away by investing in both Bergenbio ASA and Aega ASA 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 Bergenbio ASA and Aega ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bergenbio ASA and Aega ASA, you can compare the effects of market volatilities on Bergenbio ASA and Aega ASA 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 Bergenbio ASA with a short position of Aega ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bergenbio ASA and Aega ASA.
Diversification Opportunities for Bergenbio ASA and Aega ASA
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bergenbio and Aega is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Bergenbio ASA and Aega ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aega ASA and Bergenbio 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 Bergenbio ASA are associated (or correlated) with Aega ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aega ASA has no effect on the direction of Bergenbio ASA i.e., Bergenbio ASA and Aega ASA go up and down completely randomly.
Pair Corralation between Bergenbio ASA and Aega ASA
Assuming the 90 days trading horizon Bergenbio ASA is expected to under-perform the Aega ASA. But the stock apears to be less risky and, when comparing its historical volatility, Bergenbio ASA is 14.18 times less risky than Aega ASA. The stock trades about 0.0 of its potential returns per unit of risk. The Aega ASA is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 179.00 in Aega ASA on November 2, 2024 and sell it today you would lose (157.00) from holding Aega ASA or give up 87.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bergenbio ASA vs. Aega ASA
Performance |
| Timeline |
| Bergenbio ASA |
| Aega ASA |
Bergenbio ASA and Aega ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bergenbio ASA and Aega ASA
The main advantage of trading using opposite Bergenbio ASA and Aega ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bergenbio ASA position performs unexpectedly, Aega ASA 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 Aega ASA will offset losses from the drop in Aega ASA's long position.| Bergenbio ASA vs. PCI Biotech Holding | Bergenbio ASA vs. Photocure | Bergenbio ASA vs. Idex ASA | Bergenbio ASA vs. XXL ASA |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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