Correlation Between National Bank and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both National Bank and Austevoll 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 National Bank and Austevoll Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank Holdings and Austevoll Seafood ASA, you can compare the effects of market volatilities on National Bank and Austevoll 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 National Bank with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Austevoll Seafood.
Diversification Opportunities for National Bank and Austevoll Seafood
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between National and Austevoll is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding National Bank Holdings and Austevoll Seafood ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austevoll Seafood ASA and National 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 National Bank Holdings are associated (or correlated) with Austevoll Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austevoll Seafood ASA has no effect on the direction of National Bank i.e., National Bank and Austevoll Seafood go up and down completely randomly.
Pair Corralation between National Bank and Austevoll Seafood
Assuming the 90 days horizon National Bank is expected to generate 3.38 times less return on investment than Austevoll Seafood. But when comparing it to its historical volatility, National Bank Holdings is 2.69 times less risky than Austevoll Seafood. It trades about 0.04 of its potential returns per unit of risk. Austevoll Seafood ASA is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 343.00 in Austevoll Seafood ASA on November 27, 2024 and sell it today you would earn a total of 553.00 from holding Austevoll Seafood ASA or generate 161.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank Holdings vs. Austevoll Seafood ASA
Performance |
| Timeline |
| National Bank Holdings |
| Austevoll Seafood ASA |
National Bank and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Austevoll Seafood
The main advantage of trading using opposite National Bank and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Austevoll 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 Austevoll Seafood will offset losses from the drop in Austevoll Seafood's long position.| National Bank vs. TROPHY GAMES DEV | National Bank vs. PLAYMATES TOYS | National Bank vs. BORR DRILLING NEW | National Bank vs. PARKEN Sport Entertainment |
| Austevoll Seafood vs. GAMING FAC SA | Austevoll Seafood vs. Alliance Data Systems | Austevoll Seafood vs. Boyd Gaming | Austevoll Seafood vs. HOCHSCHILD MINING |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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