Correlation Between Vow ASA and LiqTech International
Can any of the company-specific risk be diversified away by investing in both Vow ASA and LiqTech International 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 Vow ASA and LiqTech International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vow ASA and LiqTech International, you can compare the effects of market volatilities on Vow ASA and LiqTech International 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 Vow ASA with a short position of LiqTech International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vow ASA and LiqTech International.
Diversification Opportunities for Vow ASA and LiqTech International
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Vow and LiqTech is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Vow ASA and LiqTech International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LiqTech International and Vow ASA 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 Vow ASA are associated (or correlated) with LiqTech International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LiqTech International has no effect on the direction of Vow ASA i.e., Vow ASA and LiqTech International go up and down completely randomly.
Pair Corralation between Vow ASA and LiqTech International
If you would invest 16.00 in Vow ASA on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Vow ASA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Vow ASA vs. LiqTech International
Performance |
| Timeline |
| Vow ASA |
| LiqTech International |
Vow ASA and LiqTech International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vow ASA and LiqTech International
The main advantage of trading using opposite Vow ASA and LiqTech International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vow ASA position performs unexpectedly, LiqTech International 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 LiqTech International will offset losses from the drop in LiqTech International's long position.| Vow ASA vs. Eestech | Vow ASA vs. Energy and Water | Vow ASA vs. One World Universe | Vow ASA vs. Bion Environmental Technologies |
| LiqTech International vs. China Natural Resources | LiqTech International vs. Seychelle Environmtl | LiqTech International vs. Vow ASA | LiqTech International vs. Eestech |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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