Correlation Between First and Grieg Seafood
Can any of the company-specific risk be diversified away by investing in both First and Grieg 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 First and Grieg Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Class Metals and Grieg Seafood, you can compare the effects of market volatilities on First and Grieg 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 First with a short position of Grieg Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of First and Grieg Seafood.
Diversification Opportunities for First and Grieg Seafood
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between First and Grieg is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding First Class Metals and Grieg Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grieg Seafood and First 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 First Class Metals are associated (or correlated) with Grieg Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grieg Seafood has no effect on the direction of First i.e., First and Grieg Seafood go up and down completely randomly.
Pair Corralation between First and Grieg Seafood
Assuming the 90 days trading horizon First Class Metals is expected to under-perform the Grieg Seafood. But the stock apears to be less risky and, when comparing its historical volatility, First Class Metals is 1.07 times less risky than Grieg Seafood. The stock trades about -0.16 of its potential returns per unit of risk. The Grieg Seafood is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 6,215 in Grieg Seafood on November 5, 2024 and sell it today you would earn a total of 1,230 from holding Grieg Seafood or generate 19.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Class Metals vs. Grieg Seafood
Performance |
| Timeline |
| First Class Metals |
| Grieg Seafood |
First and Grieg Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First and Grieg Seafood
The main advantage of trading using opposite First and Grieg Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First position performs unexpectedly, Grieg 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 Grieg Seafood will offset losses from the drop in Grieg Seafood's long position.| First vs. Kaufman Et Broad | First vs. Gaztransport et Technigaz | First vs. Empire Metals Limited | First vs. Europa Metals |
| Grieg Seafood vs. Gamma Communications PLC | Grieg Seafood vs. Charter Communications Cl | Grieg Seafood vs. bet at home AG | Grieg Seafood vs. Ecclesiastical Insurance Office |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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