Correlation Between Mowi ASA and SWISS WATER
Can any of the company-specific risk be diversified away by investing in both Mowi ASA and SWISS WATER 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 SWISS WATER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mowi ASA and SWISS WATER DECAFFCOFFEE, you can compare the effects of market volatilities on Mowi ASA and SWISS WATER 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 SWISS WATER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mowi ASA and SWISS WATER.
Diversification Opportunities for Mowi ASA and SWISS WATER
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mowi and SWISS is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Mowi ASA and SWISS WATER DECAFFCOFFEE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SWISS WATER DECAFFCOFFEE 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 SWISS WATER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SWISS WATER DECAFFCOFFEE has no effect on the direction of Mowi ASA i.e., Mowi ASA and SWISS WATER go up and down completely randomly.
Pair Corralation between Mowi ASA and SWISS WATER
Assuming the 90 days horizon Mowi ASA is expected to under-perform the SWISS WATER. But the stock apears to be less risky and, when comparing its historical volatility, Mowi ASA is 2.69 times less risky than SWISS WATER. The stock trades about -0.22 of its potential returns per unit of risk. The SWISS WATER DECAFFCOFFEE is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 272.00 in SWISS WATER DECAFFCOFFEE on September 24, 2024 and sell it today you would lose (18.00) from holding SWISS WATER DECAFFCOFFEE or give up 6.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mowi ASA vs. SWISS WATER DECAFFCOFFEE
Performance |
| Timeline |
| Mowi ASA |
| SWISS WATER DECAFFCOFFEE |
Mowi ASA and SWISS WATER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mowi ASA and SWISS WATER
The main advantage of trading using opposite Mowi ASA and SWISS WATER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mowi ASA position performs unexpectedly, SWISS WATER 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 SWISS WATER will offset losses from the drop in SWISS WATER's long position.| Mowi ASA vs. Archer Daniels Midland | Mowi ASA vs. Tyson Foods | Mowi ASA vs. Wilmar International Limited | Mowi ASA vs. MOWI ASA SPADR |
| SWISS WATER vs. Mowi ASA | SWISS WATER vs. LEROY SEAFOOD GRUNSPADR | SWISS WATER vs. Lery Seafood Group | SWISS WATER vs. Nisshin Seifun Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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