Correlation Between Lery Seafood and Romerike Sparebank
Can any of the company-specific risk be diversified away by investing in both Lery Seafood and Romerike Sparebank 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 Romerike Sparebank 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 Romerike Sparebank, you can compare the effects of market volatilities on Lery Seafood and Romerike Sparebank 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 Romerike Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lery Seafood and Romerike Sparebank.
Diversification Opportunities for Lery Seafood and Romerike Sparebank
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lery and Romerike is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Lery Seafood Group and Romerike Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Romerike Sparebank 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 Romerike Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Romerike Sparebank has no effect on the direction of Lery Seafood i.e., Lery Seafood and Romerike Sparebank go up and down completely randomly.
Pair Corralation between Lery Seafood and Romerike Sparebank
Assuming the 90 days trading horizon Lery Seafood Group is expected to under-perform the Romerike Sparebank. In addition to that, Lery Seafood is 2.1 times more volatile than Romerike Sparebank. It trades about -0.08 of its total potential returns per unit of risk. Romerike Sparebank is currently generating about 0.18 per unit of volatility. If you would invest 12,200 in Romerike Sparebank on August 28, 2024 and sell it today you would earn a total of 386.00 from holding Romerike Sparebank or generate 3.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lery Seafood Group vs. Romerike Sparebank
Performance |
| Timeline |
| Lery Seafood Group |
| Romerike Sparebank |
Lery Seafood and Romerike Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lery Seafood and Romerike Sparebank
The main advantage of trading using opposite Lery Seafood and Romerike Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lery Seafood position performs unexpectedly, Romerike Sparebank 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 Romerike Sparebank will offset losses from the drop in Romerike Sparebank's long position.The idea behind Lery Seafood Group and Romerike Sparebank 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.| Romerike Sparebank vs. Elkem ASA | Romerike Sparebank vs. Vow ASA | Romerike Sparebank vs. North Energy ASA | Romerike Sparebank vs. Arcticzymes Technologies 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Transaction History View history of all your transactions and understand their impact on performance |