Correlation Between Olav Thon and Schibsted ASA
Can any of the company-specific risk be diversified away by investing in both Olav Thon and Schibsted ASA 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 Olav Thon and Schibsted ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Olav Thon Eien and Schibsted ASA B, you can compare the effects of market volatilities on Olav Thon and Schibsted ASA 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 Olav Thon with a short position of Schibsted ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Olav Thon and Schibsted ASA.
Diversification Opportunities for Olav Thon and Schibsted ASA
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Olav and Schibsted is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Olav Thon Eien and Schibsted ASA B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schibsted ASA B and Olav Thon 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 Olav Thon Eien are associated (or correlated) with Schibsted ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schibsted ASA B has no effect on the direction of Olav Thon i.e., Olav Thon and Schibsted ASA go up and down completely randomly.
Pair Corralation between Olav Thon and Schibsted ASA
Assuming the 90 days trading horizon Olav Thon Eien is expected to under-perform the Schibsted ASA. But the stock apears to be less risky and, when comparing its historical volatility, Olav Thon Eien is 1.93 times less risky than Schibsted ASA. The stock trades about -0.02 of its potential returns per unit of risk. The Schibsted ASA B is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 25,521 in Schibsted ASA B on August 25, 2024 and sell it today you would earn a total of 8,779 from holding Schibsted ASA B or generate 34.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.24% |
| Values | Daily Returns |
Olav Thon Eien vs. Schibsted ASA B
Performance |
| Timeline |
| Olav Thon Eien |
| Schibsted ASA B |
Olav Thon and Schibsted ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Olav Thon and Schibsted ASA
The main advantage of trading using opposite Olav Thon and Schibsted ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Olav Thon position performs unexpectedly, Schibsted ASA 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 Schibsted ASA will offset losses from the drop in Schibsted ASA's long position.| Olav Thon vs. Entra ASA | Olav Thon vs. Veidekke ASA | Olav Thon vs. Selvaag Bolig ASA | Olav Thon vs. Storebrand ASA |
| Schibsted ASA vs. Kid ASA | Schibsted ASA vs. Kitron ASA | Schibsted ASA vs. Olav Thon Eien | Schibsted ASA vs. Elkem 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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