Correlation Between Mowi ASA and Sibanye Stillwater
Can any of the company-specific risk be diversified away by investing in both Mowi ASA and Sibanye Stillwater 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 Sibanye Stillwater into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mowi ASA and Sibanye Stillwater Limited, you can compare the effects of market volatilities on Mowi ASA and Sibanye Stillwater 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 Sibanye Stillwater. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mowi ASA and Sibanye Stillwater.
Diversification Opportunities for Mowi ASA and Sibanye Stillwater
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mowi and Sibanye is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Mowi ASA and Sibanye Stillwater Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sibanye Stillwater 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 Sibanye Stillwater. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sibanye Stillwater has no effect on the direction of Mowi ASA i.e., Mowi ASA and Sibanye Stillwater go up and down completely randomly.
Pair Corralation between Mowi ASA and Sibanye Stillwater
Assuming the 90 days horizon Mowi ASA is expected to generate 0.82 times more return on investment than Sibanye Stillwater. However, Mowi ASA is 1.22 times less risky than Sibanye Stillwater. It trades about 0.22 of its potential returns per unit of risk. Sibanye Stillwater Limited is currently generating about -0.24 per unit of risk. If you would invest 1,491 in Mowi ASA on August 29, 2024 and sell it today you would earn a total of 233.00 from holding Mowi ASA or generate 15.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mowi ASA vs. Sibanye Stillwater Limited
Performance |
| Timeline |
| Mowi ASA |
| Sibanye Stillwater |
Mowi ASA and Sibanye Stillwater Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mowi ASA and Sibanye Stillwater
The main advantage of trading using opposite Mowi ASA and Sibanye Stillwater positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mowi ASA position performs unexpectedly, Sibanye Stillwater 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 Sibanye Stillwater will offset losses from the drop in Sibanye Stillwater's long position.| Mowi ASA vs. Superior Plus Corp | Mowi ASA vs. NMI Holdings | Mowi ASA vs. Origin Agritech | Mowi ASA vs. SIVERS SEMICONDUCTORS AB |
| Sibanye Stillwater vs. CHIBA BANK | Sibanye Stillwater vs. VIRG NATL BANKSH | Sibanye Stillwater vs. Lendlease Group | Sibanye Stillwater vs. CDN IMPERIAL BANK |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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