Correlation Between Equinor ASA and Andfjord Salmon
Can any of the company-specific risk be diversified away by investing in both Equinor ASA and Andfjord Salmon 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 Equinor ASA and Andfjord Salmon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equinor ASA and Andfjord Salmon AS, you can compare the effects of market volatilities on Equinor ASA and Andfjord Salmon 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 Equinor ASA with a short position of Andfjord Salmon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equinor ASA and Andfjord Salmon.
Diversification Opportunities for Equinor ASA and Andfjord Salmon
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Equinor and Andfjord is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Equinor ASA and Andfjord Salmon AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Andfjord Salmon AS and Equinor 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 Equinor ASA are associated (or correlated) with Andfjord Salmon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Andfjord Salmon AS has no effect on the direction of Equinor ASA i.e., Equinor ASA and Andfjord Salmon go up and down completely randomly.
Pair Corralation between Equinor ASA and Andfjord Salmon
Assuming the 90 days trading horizon Equinor ASA is expected to generate 4.93 times less return on investment than Andfjord Salmon. But when comparing it to its historical volatility, Equinor ASA is 1.06 times less risky than Andfjord Salmon. It trades about 0.06 of its potential returns per unit of risk. Andfjord Salmon AS is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 3,100 in Andfjord Salmon AS on August 25, 2024 and sell it today you would earn a total of 900.00 from holding Andfjord Salmon AS or generate 29.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Equinor ASA vs. Andfjord Salmon AS
Performance |
| Timeline |
| Equinor ASA |
| Andfjord Salmon AS |
Equinor ASA and Andfjord Salmon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equinor ASA and Andfjord Salmon
The main advantage of trading using opposite Equinor ASA and Andfjord Salmon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equinor ASA position performs unexpectedly, Andfjord Salmon 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 Andfjord Salmon will offset losses from the drop in Andfjord Salmon's long position.| Equinor ASA vs. DnB ASA | Equinor ASA vs. Mowi ASA | Equinor ASA vs. Yara International ASA | Equinor ASA vs. Telenor ASA |
| Andfjord Salmon vs. Arctic Fish Holding | Andfjord Salmon vs. Ice Fish Farm | Andfjord Salmon vs. Elkem ASA | Andfjord Salmon vs. Vow 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |