Correlation Between Frontline and EURN Old
Can any of the company-specific risk be diversified away by investing in both Frontline and EURN Old 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 Frontline and EURN Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Frontline and EURN Old, you can compare the effects of market volatilities on Frontline and EURN Old 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 Frontline with a short position of EURN Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Frontline and EURN Old.
Diversification Opportunities for Frontline and EURN Old
Excellent diversification
The 3 months correlation between Frontline and EURN is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Frontline and EURN Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EURN Old and Frontline 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 Frontline are associated (or correlated) with EURN Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EURN Old has no effect on the direction of Frontline i.e., Frontline and EURN Old go up and down completely randomly.
Pair Corralation between Frontline and EURN Old
If you would invest 1,334 in Frontline on October 20, 2024 and sell it today you would earn a total of 402.00 from holding Frontline or generate 30.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Frontline vs. EURN Old
Performance |
| Timeline |
| Frontline |
| EURN Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Frontline and EURN Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Frontline and EURN Old
The main advantage of trading using opposite Frontline and EURN Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Frontline position performs unexpectedly, EURN Old 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 EURN Old will offset losses from the drop in EURN Old's long position.| Frontline vs. Teekay Tankers | Frontline vs. DHT Holdings | Frontline vs. International Seaways | Frontline vs. Scorpio Tankers |
| EURN Old vs. Frontline | EURN Old vs. Teekay Tankers | EURN Old vs. Scorpio Tankers | EURN Old vs. DHT Holdings |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |