Correlation Between Lea Bank and Lery Seafood
Can any of the company-specific risk be diversified away by investing in both Lea Bank 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 Lea Bank and Lery Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lea Bank ASA and Lery Seafood Group, you can compare the effects of market volatilities on Lea Bank 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 Lea Bank with a short position of Lery Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lea Bank and Lery Seafood.
Diversification Opportunities for Lea Bank and Lery Seafood
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lea and Lery is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Lea Bank 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 Lea Bank 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 Lea Bank 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 Lea Bank i.e., Lea Bank and Lery Seafood go up and down completely randomly.
Pair Corralation between Lea Bank and Lery Seafood
Assuming the 90 days trading horizon Lea Bank is expected to generate 1.02 times less return on investment than Lery Seafood. In addition to that, Lea Bank is 1.2 times more volatile than Lery Seafood Group. It trades about 0.04 of its total potential returns per unit of risk. Lery Seafood Group is currently generating about 0.05 per unit of volatility. If you would invest 4,024 in Lery Seafood Group on September 12, 2024 and sell it today you would earn a total of 1,116 from holding Lery Seafood Group or generate 27.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lea Bank ASA vs. Lery Seafood Group
Performance |
| Timeline |
| Lea Bank ASA |
| Lery Seafood Group |
Lea Bank and Lery Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lea Bank and Lery Seafood
The main advantage of trading using opposite Lea Bank and Lery Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lea Bank 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.| Lea Bank vs. Bien Sparebank ASA | Lea Bank vs. Romerike Sparebank | Lea Bank vs. Kongsberg Gruppen ASA | Lea Bank vs. Napatech AS |
| Lery Seafood vs. SalMar ASA | Lery Seafood vs. Grieg Seafood ASA | Lery Seafood vs. Austevoll Seafood ASA | Lery Seafood vs. Mowi 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |