Correlation Between Salmon Evolution and Atlantic Sapphire
Can any of the company-specific risk be diversified away by investing in both Salmon Evolution and Atlantic Sapphire 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 Salmon Evolution and Atlantic Sapphire into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salmon Evolution Holding and Atlantic Sapphire As, you can compare the effects of market volatilities on Salmon Evolution and Atlantic Sapphire 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 Salmon Evolution with a short position of Atlantic Sapphire. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salmon Evolution and Atlantic Sapphire.
Diversification Opportunities for Salmon Evolution and Atlantic Sapphire
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Salmon and Atlantic is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Salmon Evolution Holding and Atlantic Sapphire As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic Sapphire and Salmon Evolution 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 Salmon Evolution Holding are associated (or correlated) with Atlantic Sapphire. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantic Sapphire has no effect on the direction of Salmon Evolution i.e., Salmon Evolution and Atlantic Sapphire go up and down completely randomly.
Pair Corralation between Salmon Evolution and Atlantic Sapphire
Assuming the 90 days trading horizon Salmon Evolution Holding is expected to generate 0.26 times more return on investment than Atlantic Sapphire. However, Salmon Evolution Holding is 3.88 times less risky than Atlantic Sapphire. It trades about -0.2 of its potential returns per unit of risk. Atlantic Sapphire As is currently generating about -0.12 per unit of risk. If you would invest 707.00 in Salmon Evolution Holding on November 27, 2024 and sell it today you would lose (50.00) from holding Salmon Evolution Holding or give up 7.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salmon Evolution Holding vs. Atlantic Sapphire As
Performance |
| Timeline |
| Salmon Evolution Holding |
| Atlantic Sapphire |
Salmon Evolution and Atlantic Sapphire Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salmon Evolution and Atlantic Sapphire
The main advantage of trading using opposite Salmon Evolution and Atlantic Sapphire positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salmon Evolution position performs unexpectedly, Atlantic Sapphire 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 Atlantic Sapphire will offset losses from the drop in Atlantic Sapphire's long position.| Salmon Evolution vs. Melhus Sparebank | Salmon Evolution vs. Romsdal Sparebank | Salmon Evolution vs. Aurskog Sparebank | Salmon Evolution vs. Helgeland Sparebank |
| Atlantic Sapphire vs. Grieg Seafood ASA | Atlantic Sapphire vs. Mowi ASA | Atlantic Sapphire vs. SalMar ASA | Atlantic Sapphire vs. Pf Bakkafrost |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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