Correlation Between Shelf Drilling and Aker ASA
Can any of the company-specific risk be diversified away by investing in both Shelf Drilling and Aker ASA 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 Shelf Drilling and Aker ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shelf Drilling and Aker ASA, you can compare the effects of market volatilities on Shelf Drilling and Aker ASA 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 Shelf Drilling with a short position of Aker ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelf Drilling and Aker ASA.
Diversification Opportunities for Shelf Drilling and Aker ASA
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shelf and Aker is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Shelf Drilling and Aker ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker ASA and Shelf Drilling 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 Shelf Drilling are associated (or correlated) with Aker ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker ASA has no effect on the direction of Shelf Drilling i.e., Shelf Drilling and Aker ASA go up and down completely randomly.
Pair Corralation between Shelf Drilling and Aker ASA
Assuming the 90 days trading horizon Shelf Drilling is expected to generate 2.24 times more return on investment than Aker ASA. However, Shelf Drilling is 2.24 times more volatile than Aker ASA. It trades about 0.01 of its potential returns per unit of risk. Aker ASA is currently generating about -0.01 per unit of risk. If you would invest 2,270 in Shelf Drilling on September 3, 2024 and sell it today you would lose (170.00) from holding Shelf Drilling or give up 7.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shelf Drilling vs. Aker ASA
Performance |
| Timeline |
| Shelf Drilling |
| Aker ASA |
Shelf Drilling and Aker ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shelf Drilling and Aker ASA
The main advantage of trading using opposite Shelf Drilling and Aker ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shelf Drilling position performs unexpectedly, Aker ASA 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 ASA will offset losses from the drop in Aker ASA's long position.| Shelf Drilling vs. Aker ASA | Shelf Drilling vs. Subsea 7 SA | Shelf Drilling vs. Aker Solutions ASA | Shelf Drilling vs. TGS NOPEC Geophysical |
| Aker ASA vs. Storebrand ASA | Aker ASA vs. Aker Solutions ASA | Aker ASA vs. DnB ASA | Aker ASA vs. Orkla 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |