Correlation Between Mowi ASA and Lery Seafood
Can any of the company-specific risk be diversified away by investing in both Mowi 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 Mowi 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 Mowi ASA and Lery Seafood Group, you can compare the effects of market volatilities on Mowi 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 Mowi ASA with a short position of Lery Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mowi ASA and Lery Seafood.
Diversification Opportunities for Mowi ASA and Lery Seafood
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mowi and Lery is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Mowi 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 Mowi 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 Mowi 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 Mowi ASA i.e., Mowi ASA and Lery Seafood go up and down completely randomly.
Pair Corralation between Mowi ASA and Lery Seafood
Assuming the 90 days trading horizon Mowi ASA is expected to generate 0.73 times more return on investment than Lery Seafood. However, Mowi ASA is 1.37 times less risky than Lery Seafood. It trades about 0.05 of its potential returns per unit of risk. Lery Seafood Group is currently generating about 0.03 per unit of risk. If you would invest 16,865 in Mowi ASA on November 19, 2024 and sell it today you would earn a total of 5,385 from holding Mowi ASA or generate 31.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mowi ASA vs. Lery Seafood Group
Performance |
| Timeline |
| Mowi ASA |
| Lery Seafood Group |
Mowi ASA and Lery Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mowi ASA and Lery Seafood
The main advantage of trading using opposite Mowi ASA and Lery Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mowi 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.| Mowi ASA vs. SalMar ASA | Mowi ASA vs. Lery Seafood Group | Mowi ASA vs. Pf Bakkafrost | Mowi ASA vs. Grieg Seafood ASA |
| 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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