Correlation Between Havila Shipping and Kongsberg Gruppen
Can any of the company-specific risk be diversified away by investing in both Havila Shipping and Kongsberg Gruppen 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 Havila Shipping and Kongsberg Gruppen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Havila Shipping ASA and Kongsberg Gruppen ASA, you can compare the effects of market volatilities on Havila Shipping and Kongsberg Gruppen 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 Havila Shipping with a short position of Kongsberg Gruppen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Havila Shipping and Kongsberg Gruppen.
Diversification Opportunities for Havila Shipping and Kongsberg Gruppen
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Havila and Kongsberg is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Havila Shipping ASA and Kongsberg Gruppen ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kongsberg Gruppen ASA and Havila Shipping 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 Havila Shipping ASA are associated (or correlated) with Kongsberg Gruppen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kongsberg Gruppen ASA has no effect on the direction of Havila Shipping i.e., Havila Shipping and Kongsberg Gruppen go up and down completely randomly.
Pair Corralation between Havila Shipping and Kongsberg Gruppen
Assuming the 90 days trading horizon Havila Shipping ASA is expected to under-perform the Kongsberg Gruppen. In addition to that, Havila Shipping is 2.95 times more volatile than Kongsberg Gruppen ASA. It trades about -0.06 of its total potential returns per unit of risk. Kongsberg Gruppen ASA is currently generating about 0.18 per unit of volatility. If you would invest 42,871 in Kongsberg Gruppen ASA on September 12, 2024 and sell it today you would earn a total of 82,829 from holding Kongsberg Gruppen ASA or generate 193.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Havila Shipping ASA vs. Kongsberg Gruppen ASA
Performance |
| Timeline |
| Havila Shipping ASA |
| Kongsberg Gruppen ASA |
Havila Shipping and Kongsberg Gruppen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Havila Shipping and Kongsberg Gruppen
The main advantage of trading using opposite Havila Shipping and Kongsberg Gruppen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Havila Shipping position performs unexpectedly, Kongsberg Gruppen 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 Kongsberg Gruppen will offset losses from the drop in Kongsberg Gruppen's long position.| Havila Shipping vs. Solstad Offsho | Havila Shipping vs. Prosafe SE | Havila Shipping vs. BW Offshore | Havila Shipping vs. Kongsberg Gruppen ASA |
| Kongsberg Gruppen vs. Eidesvik Offshore ASA | Kongsberg Gruppen vs. Kitron ASA | Kongsberg Gruppen vs. Havila Shipping ASA | Kongsberg Gruppen vs. Arendals Fossekompani 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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