Correlation Between Instabank ASA and Lery Seafood
Can any of the company-specific risk be diversified away by investing in both Instabank ASA and Lery 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 Instabank ASA and Lery Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Instabank ASA and Lery Seafood Group, you can compare the effects of market volatilities on Instabank ASA and Lery 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 Instabank ASA with a short position of Lery Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Instabank ASA and Lery Seafood.
Diversification Opportunities for Instabank ASA and Lery Seafood
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Instabank and Lery is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Instabank ASA and Lery Seafood Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lery Seafood Group and Instabank ASA 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 Instabank ASA are associated (or correlated) with Lery Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lery Seafood Group has no effect on the direction of Instabank ASA i.e., Instabank ASA and Lery Seafood go up and down completely randomly.
Pair Corralation between Instabank ASA and Lery Seafood
Assuming the 90 days trading horizon Instabank ASA is expected to generate 1.18 times less return on investment than Lery Seafood. In addition to that, Instabank ASA is 1.11 times more volatile than Lery Seafood Group. It trades about 0.05 of its total potential returns per unit of risk. Lery Seafood Group is currently generating about 0.07 per unit of volatility. If you would invest 3,934 in Lery Seafood Group on September 4, 2024 and sell it today you would earn a total of 1,171 from holding Lery Seafood Group or generate 29.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Instabank ASA vs. Lery Seafood Group
Performance |
| Timeline |
| Instabank ASA |
| Lery Seafood Group |
Instabank ASA and Lery Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Instabank ASA and Lery Seafood
The main advantage of trading using opposite Instabank ASA and Lery Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Instabank ASA position performs unexpectedly, Lery 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 Lery Seafood will offset losses from the drop in Lery Seafood's long position.| Instabank ASA vs. DnB ASA | Instabank ASA vs. Sparebank 1 SR | Instabank ASA vs. Sparebank 1 SMN | Instabank ASA vs. Sparebanken Mre |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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