Correlation Between CARSALESCOM and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both CARSALESCOM and Austevoll Seafood 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 CARSALESCOM and Austevoll Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CARSALESCOM and Austevoll Seafood ASA, you can compare the effects of market volatilities on CARSALESCOM and Austevoll Seafood 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 CARSALESCOM with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of CARSALESCOM and Austevoll Seafood.
Diversification Opportunities for CARSALESCOM and Austevoll Seafood
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CARSALESCOM and Austevoll is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding CARSALESCOM and Austevoll Seafood ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austevoll Seafood ASA and CARSALESCOM 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 CARSALESCOM are associated (or correlated) with Austevoll Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austevoll Seafood ASA has no effect on the direction of CARSALESCOM i.e., CARSALESCOM and Austevoll Seafood go up and down completely randomly.
Pair Corralation between CARSALESCOM and Austevoll Seafood
Assuming the 90 days trading horizon CARSALESCOM is expected to generate 0.71 times more return on investment than Austevoll Seafood. However, CARSALESCOM is 1.41 times less risky than Austevoll Seafood. It trades about 0.36 of its potential returns per unit of risk. Austevoll Seafood ASA is currently generating about 0.11 per unit of risk. If you would invest 2,280 in CARSALESCOM on August 28, 2024 and sell it today you would earn a total of 260.00 from holding CARSALESCOM or generate 11.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CARSALESCOM vs. Austevoll Seafood ASA
Performance |
| Timeline |
| CARSALESCOM |
| Austevoll Seafood ASA |
CARSALESCOM and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CARSALESCOM and Austevoll Seafood
The main advantage of trading using opposite CARSALESCOM and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CARSALESCOM position performs unexpectedly, Austevoll Seafood 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 Austevoll Seafood will offset losses from the drop in Austevoll Seafood's long position.| CARSALESCOM vs. Apple Inc | CARSALESCOM vs. Apple Inc | CARSALESCOM vs. Microsoft | CARSALESCOM vs. Microsoft |
| Austevoll Seafood vs. Superior Plus Corp | Austevoll Seafood vs. NMI Holdings | Austevoll Seafood vs. Origin Agritech | Austevoll Seafood vs. SIVERS SEMICONDUCTORS AB |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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