Correlation Between Stora Enso and AUSTEVOLL SEAFOOD
Can any of the company-specific risk be diversified away by investing in both Stora Enso 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 Stora Enso and AUSTEVOLL SEAFOOD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stora Enso Oyj and AUSTEVOLL SEAFOOD, you can compare the effects of market volatilities on Stora Enso 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 Stora Enso with a short position of AUSTEVOLL SEAFOOD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stora Enso and AUSTEVOLL SEAFOOD.
Diversification Opportunities for Stora Enso and AUSTEVOLL SEAFOOD
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Stora and AUSTEVOLL is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Stora Enso Oyj and AUSTEVOLL SEAFOOD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AUSTEVOLL SEAFOOD and Stora Enso 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 Stora Enso Oyj 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 has no effect on the direction of Stora Enso i.e., Stora Enso and AUSTEVOLL SEAFOOD go up and down completely randomly.
Pair Corralation between Stora Enso and AUSTEVOLL SEAFOOD
Assuming the 90 days trading horizon Stora Enso is expected to generate 3.5 times less return on investment than AUSTEVOLL SEAFOOD. But when comparing it to its historical volatility, Stora Enso Oyj is 1.22 times less risky than AUSTEVOLL SEAFOOD. It trades about 0.05 of its potential returns per unit of risk. AUSTEVOLL SEAFOOD is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 832.00 in AUSTEVOLL SEAFOOD on September 14, 2024 and sell it today you would earn a total of 33.00 from holding AUSTEVOLL SEAFOOD or generate 3.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stora Enso Oyj vs. AUSTEVOLL SEAFOOD
Performance |
| Timeline |
| Stora Enso Oyj |
| AUSTEVOLL SEAFOOD |
Stora Enso and AUSTEVOLL SEAFOOD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stora Enso and AUSTEVOLL SEAFOOD
The main advantage of trading using opposite Stora Enso and AUSTEVOLL SEAFOOD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stora Enso 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.| Stora Enso vs. STMICROELECTRONICS | Stora Enso vs. PT Global Mediacom | Stora Enso vs. Arrow Electronics | Stora Enso vs. PLAYSTUDIOS A DL 0001 |
| AUSTEVOLL SEAFOOD vs. Apple Inc | AUSTEVOLL SEAFOOD vs. Apple Inc | AUSTEVOLL SEAFOOD vs. Apple Inc | AUSTEVOLL SEAFOOD vs. Apple Inc |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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