Correlation Between Saga Pure and Aker Horizons
Can any of the company-specific risk be diversified away by investing in both Saga Pure and Aker Horizons 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 Saga Pure and Aker Horizons into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saga Pure ASA and Aker Horizons AS, you can compare the effects of market volatilities on Saga Pure and Aker Horizons 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 Saga Pure with a short position of Aker Horizons. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saga Pure and Aker Horizons.
Diversification Opportunities for Saga Pure and Aker Horizons
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Saga and Aker is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Saga Pure ASA and Aker Horizons AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker Horizons AS and Saga Pure 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 Saga Pure ASA are associated (or correlated) with Aker Horizons. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker Horizons AS has no effect on the direction of Saga Pure i.e., Saga Pure and Aker Horizons go up and down completely randomly.
Pair Corralation between Saga Pure and Aker Horizons
Assuming the 90 days trading horizon Saga Pure ASA is expected to generate 0.2 times more return on investment than Aker Horizons. However, Saga Pure ASA is 5.03 times less risky than Aker Horizons. It trades about -0.07 of its potential returns per unit of risk. Aker Horizons AS is currently generating about -0.31 per unit of risk. If you would invest 129.00 in Saga Pure ASA on August 29, 2024 and sell it today you would lose (2.00) from holding Saga Pure ASA or give up 1.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saga Pure ASA vs. Aker Horizons AS
Performance |
| Timeline |
| Saga Pure ASA |
| Aker Horizons AS |
Saga Pure and Aker Horizons Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saga Pure and Aker Horizons
The main advantage of trading using opposite Saga Pure and Aker Horizons positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saga Pure position performs unexpectedly, Aker Horizons 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 Aker Horizons will offset losses from the drop in Aker Horizons' long position.| Saga Pure vs. Frontline | Saga Pure vs. BW LPG | Saga Pure vs. FLEX LNG | Saga Pure vs. Dampskibsselskabet Norden AS |
| Aker Horizons vs. Wilh Wilhelmsen Holding | Aker Horizons vs. Pareto Bank ASA | Aker Horizons vs. Selvaag Bolig ASA | Aker Horizons vs. Wilh Wilhelmsen Holding |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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