Correlation Between PARKEN Sport and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both PARKEN Sport 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 PARKEN Sport and Austevoll Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PARKEN Sport Entertainment and Austevoll Seafood ASA, you can compare the effects of market volatilities on PARKEN Sport 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 PARKEN Sport with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and Austevoll Seafood.
Diversification Opportunities for PARKEN Sport and Austevoll Seafood
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PARKEN and Austevoll is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment 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 PARKEN Sport 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 PARKEN Sport Entertainment 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 PARKEN Sport i.e., PARKEN Sport and Austevoll Seafood go up and down completely randomly.
Pair Corralation between PARKEN Sport and Austevoll Seafood
Assuming the 90 days horizon PARKEN Sport is expected to generate 3.58 times less return on investment than Austevoll Seafood. But when comparing it to its historical volatility, PARKEN Sport Entertainment is 1.35 times less risky than Austevoll Seafood. It trades about 0.04 of its potential returns per unit of risk. Austevoll Seafood ASA is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 821.00 in Austevoll Seafood ASA on August 30, 2024 and sell it today you would earn a total of 39.00 from holding Austevoll Seafood ASA or generate 4.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
PARKEN Sport Entertainment vs. Austevoll Seafood ASA
Performance |
| Timeline |
| PARKEN Sport Enterta |
| Austevoll Seafood ASA |
PARKEN Sport and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PARKEN Sport and Austevoll Seafood
The main advantage of trading using opposite PARKEN Sport and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport 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.| PARKEN Sport vs. Netflix | PARKEN Sport vs. Superior Plus Corp | PARKEN Sport vs. NMI Holdings | PARKEN Sport vs. SIVERS SEMICONDUCTORS AB |
| Austevoll Seafood vs. Tyson Foods | Austevoll Seafood vs. SalMar ASA | Austevoll Seafood vs. Superior Plus Corp | Austevoll Seafood vs. SIVERS SEMICONDUCTORS AB |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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