Correlation Between Selvaag Bolig and Baltic Sea
Can any of the company-specific risk be diversified away by investing in both Selvaag Bolig and Baltic Sea 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 Selvaag Bolig and Baltic Sea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Selvaag Bolig ASA and Baltic Sea Properties, you can compare the effects of market volatilities on Selvaag Bolig and Baltic Sea 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 Selvaag Bolig with a short position of Baltic Sea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Selvaag Bolig and Baltic Sea.
Diversification Opportunities for Selvaag Bolig and Baltic Sea
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Selvaag and Baltic is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Selvaag Bolig ASA and Baltic Sea Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baltic Sea Properties and Selvaag Bolig 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 Selvaag Bolig ASA are associated (or correlated) with Baltic Sea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baltic Sea Properties has no effect on the direction of Selvaag Bolig i.e., Selvaag Bolig and Baltic Sea go up and down completely randomly.
Pair Corralation between Selvaag Bolig and Baltic Sea
Assuming the 90 days trading horizon Selvaag Bolig ASA is expected to generate 0.43 times more return on investment than Baltic Sea. However, Selvaag Bolig ASA is 2.35 times less risky than Baltic Sea. It trades about 0.13 of its potential returns per unit of risk. Baltic Sea Properties is currently generating about 0.04 per unit of risk. If you would invest 3,225 in Selvaag Bolig ASA on September 3, 2024 and sell it today you would earn a total of 155.00 from holding Selvaag Bolig ASA or generate 4.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Selvaag Bolig ASA vs. Baltic Sea Properties
Performance |
| Timeline |
| Selvaag Bolig ASA |
| Baltic Sea Properties |
Selvaag Bolig and Baltic Sea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Selvaag Bolig and Baltic Sea
The main advantage of trading using opposite Selvaag Bolig and Baltic Sea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Selvaag Bolig position performs unexpectedly, Baltic Sea 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 Baltic Sea will offset losses from the drop in Baltic Sea's long position.| Selvaag Bolig vs. Veidekke ASA | Selvaag Bolig vs. Entra ASA | Selvaag Bolig vs. Kid ASA | Selvaag Bolig vs. Olav Thon Eien |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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