Correlation Between Var Energi and Kongsberg Automotive
Can any of the company-specific risk be diversified away by investing in both Var Energi and Kongsberg Automotive 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 Var Energi and Kongsberg Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Var Energi ASA and Kongsberg Automotive Holding, you can compare the effects of market volatilities on Var Energi and Kongsberg Automotive 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 Var Energi with a short position of Kongsberg Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Var Energi and Kongsberg Automotive.
Diversification Opportunities for Var Energi and Kongsberg Automotive
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Var and Kongsberg is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Var Energi ASA and Kongsberg Automotive Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kongsberg Automotive and Var Energi 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 Var Energi ASA are associated (or correlated) with Kongsberg Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kongsberg Automotive has no effect on the direction of Var Energi i.e., Var Energi and Kongsberg Automotive go up and down completely randomly.
Pair Corralation between Var Energi and Kongsberg Automotive
Assuming the 90 days trading horizon Var Energi ASA is expected to generate 0.57 times more return on investment than Kongsberg Automotive. However, Var Energi ASA is 1.76 times less risky than Kongsberg Automotive. It trades about 0.06 of its potential returns per unit of risk. Kongsberg Automotive Holding is currently generating about -0.01 per unit of risk. If you would invest 3,298 in Var Energi ASA on September 5, 2024 and sell it today you would earn a total of 362.00 from holding Var Energi ASA or generate 10.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
Var Energi ASA vs. Kongsberg Automotive Holding
Performance |
| Timeline |
| Var Energi ASA |
| Kongsberg Automotive |
Var Energi and Kongsberg Automotive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Var Energi and Kongsberg Automotive
The main advantage of trading using opposite Var Energi and Kongsberg Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Var Energi position performs unexpectedly, Kongsberg Automotive 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 Kongsberg Automotive will offset losses from the drop in Kongsberg Automotive's long position.| Var Energi vs. Kongsberg Automotive Holding | Var Energi vs. Questerre Energy | Var Energi vs. Okea ASA | Var Energi vs. Hunter Group ASA |
| Kongsberg Automotive vs. Zaptec AS | Kongsberg Automotive vs. Norwegian Air Shuttle | Kongsberg Automotive vs. Elkem ASA | Kongsberg Automotive vs. Integrated Wind Solutions |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Stocks Directory Find actively traded stocks across global markets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |