Correlation Between SpareBank and Clean Seas
Can any of the company-specific risk be diversified away by investing in both SpareBank and Clean Seas 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 SpareBank and Clean Seas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SpareBank 1 stlandet and Clean Seas Seafood, you can compare the effects of market volatilities on SpareBank and Clean Seas 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 SpareBank with a short position of Clean Seas. Check out your portfolio center. Please also check ongoing floating volatility patterns of SpareBank and Clean Seas.
Diversification Opportunities for SpareBank and Clean Seas
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SpareBank and Clean is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding SpareBank 1 stlandet and Clean Seas Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Seas Seafood and SpareBank 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 SpareBank 1 stlandet are associated (or correlated) with Clean Seas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Seas Seafood has no effect on the direction of SpareBank i.e., SpareBank and Clean Seas go up and down completely randomly.
Pair Corralation between SpareBank and Clean Seas
Assuming the 90 days trading horizon SpareBank 1 stlandet is expected to generate 0.32 times more return on investment than Clean Seas. However, SpareBank 1 stlandet is 3.09 times less risky than Clean Seas. It trades about 0.07 of its potential returns per unit of risk. Clean Seas Seafood is currently generating about -0.17 per unit of risk. If you would invest 13,572 in SpareBank 1 stlandet on September 1, 2024 and sell it today you would earn a total of 1,502 from holding SpareBank 1 stlandet or generate 11.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SpareBank 1 stlandet vs. Clean Seas Seafood
Performance |
| Timeline |
| SpareBank 1 stlandet |
| Clean Seas Seafood |
SpareBank and Clean Seas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SpareBank and Clean Seas
The main advantage of trading using opposite SpareBank and Clean Seas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SpareBank position performs unexpectedly, Clean Seas 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 Clean Seas will offset losses from the drop in Clean Seas' long position.| SpareBank vs. Sparebank 1 SMN | SpareBank vs. Sparebank 1 Nord Norge | SpareBank vs. Sparebanken Vest | SpareBank vs. Sparebank 1 SR |
| Clean Seas vs. Masoval AS | Clean Seas vs. Andfjord Salmon AS | Clean Seas vs. Arctic Fish Holding | Clean Seas vs. Ice Fish Farm |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| 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 | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| CEOs Directory Screen CEOs from public companies around the world |