Correlation Between Commercial Vehicle and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both Commercial Vehicle 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 Commercial Vehicle and Austevoll Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Commercial Vehicle Group and Austevoll Seafood ASA, you can compare the effects of market volatilities on Commercial Vehicle 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 Commercial Vehicle with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commercial Vehicle and Austevoll Seafood.
Diversification Opportunities for Commercial Vehicle and Austevoll Seafood
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Commercial and Austevoll is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Commercial Vehicle Group 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 Commercial Vehicle 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 Commercial Vehicle Group 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 Commercial Vehicle i.e., Commercial Vehicle and Austevoll Seafood go up and down completely randomly.
Pair Corralation between Commercial Vehicle and Austevoll Seafood
Assuming the 90 days trading horizon Commercial Vehicle Group is expected to under-perform the Austevoll Seafood. In addition to that, Commercial Vehicle is 1.95 times more volatile than Austevoll Seafood ASA. It trades about -0.26 of its total potential returns per unit of risk. Austevoll Seafood ASA is currently generating about 0.11 per unit of volatility. If you would invest 819.00 in Austevoll Seafood ASA on August 28, 2024 and sell it today you would earn a total of 36.00 from holding Austevoll Seafood ASA or generate 4.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Commercial Vehicle Group vs. Austevoll Seafood ASA
Performance |
| Timeline |
| Commercial Vehicle |
| Austevoll Seafood ASA |
Commercial Vehicle and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Commercial Vehicle and Austevoll Seafood
The main advantage of trading using opposite Commercial Vehicle and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commercial Vehicle 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.| Commercial Vehicle vs. XLMedia PLC | Commercial Vehicle vs. Flutter Entertainment PLC | Commercial Vehicle vs. ANTA SPORTS PRODUCT | Commercial Vehicle vs. PT Global Mediacom |
| Austevoll Seafood vs. Superior Plus Corp | Austevoll Seafood vs. NMI Holdings | Austevoll Seafood vs. Origin Agritech | 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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