Correlation Between Hoegh Autoliners and Norske Skog
Can any of the company-specific risk be diversified away by investing in both Hoegh Autoliners and Norske Skog 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 Hoegh Autoliners and Norske Skog into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hoegh Autoliners ASA and Norske Skog Asa, you can compare the effects of market volatilities on Hoegh Autoliners and Norske Skog 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 Hoegh Autoliners with a short position of Norske Skog. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hoegh Autoliners and Norske Skog.
Diversification Opportunities for Hoegh Autoliners and Norske Skog
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hoegh and Norske is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Hoegh Autoliners ASA and Norske Skog Asa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norske Skog Asa and Hoegh Autoliners 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 Hoegh Autoliners ASA are associated (or correlated) with Norske Skog. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norske Skog Asa has no effect on the direction of Hoegh Autoliners i.e., Hoegh Autoliners and Norske Skog go up and down completely randomly.
Pair Corralation between Hoegh Autoliners and Norske Skog
Assuming the 90 days trading horizon Hoegh Autoliners ASA is expected to generate 0.54 times more return on investment than Norske Skog. However, Hoegh Autoliners ASA is 1.86 times less risky than Norske Skog. It trades about 0.24 of its potential returns per unit of risk. Norske Skog Asa is currently generating about 0.03 per unit of risk. If you would invest 11,320 in Hoegh Autoliners ASA on September 3, 2024 and sell it today you would earn a total of 1,500 from holding Hoegh Autoliners ASA or generate 13.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hoegh Autoliners ASA vs. Norske Skog Asa
Performance |
| Timeline |
| Hoegh Autoliners ASA |
| Norske Skog Asa |
Hoegh Autoliners and Norske Skog Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hoegh Autoliners and Norske Skog
The main advantage of trading using opposite Hoegh Autoliners and Norske Skog positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hoegh Autoliners position performs unexpectedly, Norske Skog 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 Norske Skog will offset losses from the drop in Norske Skog's long position.| Hoegh Autoliners vs. Havila Shipping ASA | Hoegh Autoliners vs. Shelf Drilling | Hoegh Autoliners vs. Solstad Offsho | Hoegh Autoliners vs. Eidesvik Offshore ASA |
| Norske Skog vs. Elkem ASA | Norske Skog vs. Integrated Wind Solutions | Norske Skog vs. Vow ASA | Norske Skog vs. North Energy ASA |
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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