Correlation Between Masoval AS and Clean Seas
Can any of the company-specific risk be diversified away by investing in both Masoval AS and Clean Seas 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 Masoval AS and Clean Seas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Masoval AS and Clean Seas Seafood, you can compare the effects of market volatilities on Masoval AS and Clean Seas 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 Masoval AS with a short position of Clean Seas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Masoval AS and Clean Seas.
Diversification Opportunities for Masoval AS and Clean Seas
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Masoval and Clean is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Masoval AS and Clean Seas Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Seas Seafood and Masoval AS 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 Masoval AS are associated (or correlated) with Clean Seas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Seas Seafood has no effect on the direction of Masoval AS i.e., Masoval AS and Clean Seas go up and down completely randomly.
Pair Corralation between Masoval AS and Clean Seas
Assuming the 90 days trading horizon Masoval AS is expected to under-perform the Clean Seas. But the stock apears to be less risky and, when comparing its historical volatility, Masoval AS is 2.9 times less risky than Clean Seas. The stock trades about -0.08 of its potential returns per unit of risk. The Clean Seas Seafood is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 85.00 in Clean Seas Seafood on November 30, 2024 and sell it today you would earn a total of 15.00 from holding Clean Seas Seafood or generate 17.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Masoval AS vs. Clean Seas Seafood
Performance |
| Timeline |
| Masoval AS |
| Clean Seas Seafood |
Masoval AS and Clean Seas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Masoval AS and Clean Seas
The main advantage of trading using opposite Masoval AS and Clean Seas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Masoval AS position performs unexpectedly, Clean Seas 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 Clean Seas will offset losses from the drop in Clean Seas' long position.| Masoval AS vs. Icelandic Salmon As | Masoval AS vs. Ice Fish Farm | Masoval AS vs. Arctic Fish Holding | Masoval AS vs. Bewi Asa |
| Clean Seas vs. Masoval AS | Clean Seas vs. Andfjord Salmon AS | Clean Seas vs. Arctic Fish Holding | Clean Seas vs. Ice Fish Farm |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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