Correlation Between Grieg Seafood and Grong Sparebank
Can any of the company-specific risk be diversified away by investing in both Grieg Seafood and Grong Sparebank 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 Grieg Seafood and Grong Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grieg Seafood ASA and Grong Sparebank, you can compare the effects of market volatilities on Grieg Seafood and Grong Sparebank 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 Grieg Seafood with a short position of Grong Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grieg Seafood and Grong Sparebank.
Diversification Opportunities for Grieg Seafood and Grong Sparebank
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grieg and Grong is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Grieg Seafood ASA and Grong Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grong Sparebank and Grieg Seafood 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 Grieg Seafood ASA are associated (or correlated) with Grong Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grong Sparebank has no effect on the direction of Grieg Seafood i.e., Grieg Seafood and Grong Sparebank go up and down completely randomly.
Pair Corralation between Grieg Seafood and Grong Sparebank
Assuming the 90 days trading horizon Grieg Seafood ASA is expected to under-perform the Grong Sparebank. In addition to that, Grieg Seafood is 2.1 times more volatile than Grong Sparebank. It trades about -0.05 of its total potential returns per unit of risk. Grong Sparebank is currently generating about 0.08 per unit of volatility. If you would invest 15,000 in Grong Sparebank on October 25, 2024 and sell it today you would earn a total of 188.00 from holding Grong Sparebank or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Grieg Seafood ASA vs. Grong Sparebank
Performance |
| Timeline |
| Grieg Seafood ASA |
| Grong Sparebank |
Grieg Seafood and Grong Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grieg Seafood and Grong Sparebank
The main advantage of trading using opposite Grieg Seafood and Grong Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grieg Seafood position performs unexpectedly, Grong Sparebank 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 Grong Sparebank will offset losses from the drop in Grong Sparebank's long position.| Grieg Seafood vs. Lery Seafood Group | Grieg Seafood vs. SalMar ASA | Grieg Seafood vs. Austevoll Seafood ASA | Grieg Seafood vs. Mowi ASA |
| Grong Sparebank vs. Sparebanken Ost | Grong Sparebank vs. Aurskog Sparebank | Grong Sparebank vs. Romerike Sparebank | Grong Sparebank vs. Dolphin Drilling AS |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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