Correlation Between PREMIER FOODS and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both PREMIER FOODS 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 PREMIER FOODS and Austevoll Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PREMIER FOODS and Austevoll Seafood ASA, you can compare the effects of market volatilities on PREMIER FOODS 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 PREMIER FOODS with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of PREMIER FOODS and Austevoll Seafood.
Diversification Opportunities for PREMIER FOODS and Austevoll Seafood
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between PREMIER and Austevoll is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding PREMIER FOODS 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 PREMIER FOODS 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 PREMIER FOODS 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 PREMIER FOODS i.e., PREMIER FOODS and Austevoll Seafood go up and down completely randomly.
Pair Corralation between PREMIER FOODS and Austevoll Seafood
Assuming the 90 days trading horizon PREMIER FOODS is expected to generate 0.73 times more return on investment than Austevoll Seafood. However, PREMIER FOODS is 1.38 times less risky than Austevoll Seafood. It trades about 0.07 of its potential returns per unit of risk. Austevoll Seafood ASA is currently generating about -0.01 per unit of risk. If you would invest 218.00 in PREMIER FOODS on November 27, 2024 and sell it today you would earn a total of 4.00 from holding PREMIER FOODS or generate 1.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PREMIER FOODS vs. Austevoll Seafood ASA
Performance |
| Timeline |
| PREMIER FOODS |
| Austevoll Seafood ASA |
PREMIER FOODS and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PREMIER FOODS and Austevoll Seafood
The main advantage of trading using opposite PREMIER FOODS and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PREMIER FOODS 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.| PREMIER FOODS vs. Commonwealth Bank of | PREMIER FOODS vs. Takark Jelzlogbank Nyrt | PREMIER FOODS vs. Virtu Financial | PREMIER FOODS vs. DALATA HOTEL |
| Austevoll Seafood vs. GAMING FAC SA | Austevoll Seafood vs. Alliance Data Systems | Austevoll Seafood vs. Boyd Gaming | Austevoll Seafood vs. HOCHSCHILD MINING |
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 Stocks Directory module to find actively traded stocks across global markets.
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