Correlation Between Lerøy Seafood and Talanx AG
Can any of the company-specific risk be diversified away by investing in both Lerøy Seafood and Talanx AG 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 Talanx AG 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 Talanx AG, you can compare the effects of market volatilities on Lerøy Seafood and Talanx AG 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 Talanx AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lerøy Seafood and Talanx AG.
Diversification Opportunities for Lerøy Seafood and Talanx AG
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lerøy and Talanx is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Lery Seafood Group and Talanx AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talanx AG 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 Talanx AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talanx AG has no effect on the direction of Lerøy Seafood i.e., Lerøy Seafood and Talanx AG go up and down completely randomly.
Pair Corralation between Lerøy Seafood and Talanx AG
Assuming the 90 days horizon Lery Seafood Group is expected to under-perform the Talanx AG. In addition to that, Lerøy Seafood is 1.28 times more volatile than Talanx AG. It trades about -0.02 of its total potential returns per unit of risk. Talanx AG is currently generating about 0.22 per unit of volatility. If you would invest 7,580 in Talanx AG on September 13, 2024 and sell it today you would earn a total of 970.00 from holding Talanx AG or generate 12.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lery Seafood Group vs. Talanx AG
Performance |
| Timeline |
| Lery Seafood Group |
| Talanx AG |
Lerøy Seafood and Talanx AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lerøy Seafood and Talanx AG
The main advantage of trading using opposite Lerøy Seafood and Talanx AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lerøy Seafood position performs unexpectedly, Talanx AG 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 Talanx AG will offset losses from the drop in Talanx AG's 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 |
| Talanx AG vs. Transportadora de Gas | Talanx AG vs. Amkor Technology | Talanx AG vs. DICKS Sporting Goods | Talanx AG vs. GLG LIFE TECH |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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