Correlation Between Lerøy Seafood and Dassault Systmes
Can any of the company-specific risk be diversified away by investing in both Lerøy Seafood and Dassault Systmes 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 Lerøy Seafood and Dassault Systmes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lery Seafood Group and Dassault Systmes SE, you can compare the effects of market volatilities on Lerøy Seafood and Dassault Systmes 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 Lerøy Seafood with a short position of Dassault Systmes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lerøy Seafood and Dassault Systmes.
Diversification Opportunities for Lerøy Seafood and Dassault Systmes
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lerøy and Dassault is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Lery Seafood Group and Dassault Systmes SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dassault Systmes and Lerøy Seafood 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 Lery Seafood Group are associated (or correlated) with Dassault Systmes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dassault Systmes has no effect on the direction of Lerøy Seafood i.e., Lerøy Seafood and Dassault Systmes go up and down completely randomly.
Pair Corralation between Lerøy Seafood and Dassault Systmes
Assuming the 90 days horizon Lerøy Seafood is expected to generate 2.95 times less return on investment than Dassault Systmes. In addition to that, Lerøy Seafood is 1.33 times more volatile than Dassault Systmes SE. It trades about 0.06 of its total potential returns per unit of risk. Dassault Systmes SE is currently generating about 0.22 per unit of volatility. If you would invest 3,220 in Dassault Systmes SE on September 13, 2024 and sell it today you would earn a total of 240.00 from holding Dassault Systmes SE or generate 7.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lery Seafood Group vs. Dassault Systmes SE
Performance |
| Timeline |
| Lery Seafood Group |
| Dassault Systmes |
Lerøy Seafood and Dassault Systmes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lerøy Seafood and Dassault Systmes
The main advantage of trading using opposite Lerøy Seafood and Dassault Systmes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lerøy Seafood position performs unexpectedly, Dassault Systmes 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 Dassault Systmes will offset losses from the drop in Dassault Systmes' long position.| Lerøy Seafood vs. Hormel Foods | Lerøy Seafood vs. Superior Plus Corp | Lerøy Seafood vs. SIVERS SEMICONDUCTORS AB | Lerøy Seafood vs. NorAm Drilling AS |
| Dassault Systmes vs. National Bank Holdings | Dassault Systmes vs. SINGAPORE AIRLINES | Dassault Systmes vs. CHIBA BANK | Dassault Systmes vs. Chiba Bank |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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