Correlation Between Lery Seafood and Proximar Seafood
Can any of the company-specific risk be diversified away by investing in both Lery Seafood and Proximar 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 Lery Seafood and Proximar Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lery Seafood Group and Proximar Seafood AS, you can compare the effects of market volatilities on Lery Seafood and Proximar 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 Lery Seafood with a short position of Proximar Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lery Seafood and Proximar Seafood.
Diversification Opportunities for Lery Seafood and Proximar Seafood
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lery and Proximar is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Lery Seafood Group and Proximar Seafood AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proximar Seafood and Lery 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 Lery Seafood Group are associated (or correlated) with Proximar Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proximar Seafood has no effect on the direction of Lery Seafood i.e., Lery Seafood and Proximar Seafood go up and down completely randomly.
Pair Corralation between Lery Seafood and Proximar Seafood
Assuming the 90 days trading horizon Lery Seafood is expected to generate 1.44 times less return on investment than Proximar Seafood. But when comparing it to its historical volatility, Lery Seafood Group is 1.92 times less risky than Proximar Seafood. It trades about 0.01 of its potential returns per unit of risk. Proximar Seafood AS is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 429.00 in Proximar Seafood AS on August 28, 2024 and sell it today you would lose (69.00) from holding Proximar Seafood AS or give up 16.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lery Seafood Group vs. Proximar Seafood AS
Performance |
| Timeline |
| Lery Seafood Group |
| Proximar Seafood |
Lery Seafood and Proximar Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lery Seafood and Proximar Seafood
The main advantage of trading using opposite Lery Seafood and Proximar Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lery Seafood position performs unexpectedly, Proximar 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 Proximar Seafood will offset losses from the drop in Proximar Seafood's long position.The idea behind Lery Seafood Group and Proximar Seafood AS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Proximar Seafood vs. Nidaros Sparebank | Proximar Seafood vs. Aasen Sparebank | Proximar Seafood vs. Pareto Bank ASA | Proximar Seafood vs. Gaming Innovation Group |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |