Correlation Between Dno ASA and Southern Cross
Can any of the company-specific risk be diversified away by investing in both Dno ASA and Southern Cross 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 Dno ASA and Southern Cross into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dno ASA and Southern Cross Media, you can compare the effects of market volatilities on Dno ASA and Southern Cross 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 Dno ASA with a short position of Southern Cross. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dno ASA and Southern Cross.
Diversification Opportunities for Dno ASA and Southern Cross
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dno and Southern is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Dno ASA and Southern Cross Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Cross Media and Dno 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 Dno ASA are associated (or correlated) with Southern Cross. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Cross Media has no effect on the direction of Dno ASA i.e., Dno ASA and Southern Cross go up and down completely randomly.
Pair Corralation between Dno ASA and Southern Cross
Assuming the 90 days horizon Dno ASA is expected to generate 1.17 times more return on investment than Southern Cross. However, Dno ASA is 1.17 times more volatile than Southern Cross Media. It trades about 0.31 of its potential returns per unit of risk. Southern Cross Media is currently generating about 0.18 per unit of risk. If you would invest 88.00 in Dno ASA on November 3, 2024 and sell it today you would earn a total of 25.00 from holding Dno ASA or generate 28.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dno ASA vs. Southern Cross Media
Performance |
| Timeline |
| Dno ASA |
| Southern Cross Media |
Dno ASA and Southern Cross Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dno ASA and Southern Cross
The main advantage of trading using opposite Dno ASA and Southern Cross positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dno ASA position performs unexpectedly, Southern Cross 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 Southern Cross will offset losses from the drop in Southern Cross' long position.| Dno ASA vs. PetroShale | Dno ASA vs. Horizon Oil Limited | Dno ASA vs. Enwell Energy plc | Dno ASA vs. Tullow Oil plc |
| Southern Cross vs. Pieridae Energy Limited | Southern Cross vs. Prospera Energy | Southern Cross vs. Ngx Energy International | Southern Cross vs. Barrister Energy LLC |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |