Correlation Between Salmon Evolution and Sparebank
Can any of the company-specific risk be diversified away by investing in both Salmon Evolution and Sparebank 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 Sparebank 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 Sparebank 1 SMN, you can compare the effects of market volatilities on Salmon Evolution and Sparebank 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 Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salmon Evolution and Sparebank.
Diversification Opportunities for Salmon Evolution and Sparebank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Salmon and Sparebank is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Salmon Evolution Holding and Sparebank 1 SMN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparebank 1 SMN 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 Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparebank 1 SMN has no effect on the direction of Salmon Evolution i.e., Salmon Evolution and Sparebank go up and down completely randomly.
Pair Corralation between Salmon Evolution and Sparebank
Assuming the 90 days trading horizon Salmon Evolution is expected to generate 2.94 times less return on investment than Sparebank. In addition to that, Salmon Evolution is 1.35 times more volatile than Sparebank 1 SMN. It trades about 0.02 of its total potential returns per unit of risk. Sparebank 1 SMN is currently generating about 0.09 per unit of volatility. If you would invest 12,324 in Sparebank 1 SMN on September 4, 2024 and sell it today you would earn a total of 3,940 from holding Sparebank 1 SMN or generate 31.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salmon Evolution Holding vs. Sparebank 1 SMN
Performance |
| Timeline |
| Salmon Evolution Holding |
| Sparebank 1 SMN |
Salmon Evolution and Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salmon Evolution and Sparebank
The main advantage of trading using opposite Salmon Evolution and Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salmon Evolution position performs unexpectedly, Sparebank 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 Sparebank will offset losses from the drop in Sparebank's long position.| Salmon Evolution vs. Odfjell Technology | Salmon Evolution vs. BW Offshore | Salmon Evolution vs. Bien Sparebank ASA | Salmon Evolution vs. Proximar Seafood AS |
| Sparebank vs. Sparebank 1 Nord Norge | Sparebank vs. Sparebanken Vest | Sparebank vs. Storebrand ASA | Sparebank vs. DnB 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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