Correlation Between Austevoll Seafood and Mitsui Chemicals
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Mitsui Chemicals 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 Austevoll Seafood and Mitsui Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Austevoll Seafood ASA and Mitsui Chemicals, you can compare the effects of market volatilities on Austevoll Seafood and Mitsui Chemicals 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 Austevoll Seafood with a short position of Mitsui Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Mitsui Chemicals.
Diversification Opportunities for Austevoll Seafood and Mitsui Chemicals
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Austevoll and Mitsui is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Mitsui Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsui Chemicals and Austevoll 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 Austevoll Seafood ASA are associated (or correlated) with Mitsui Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsui Chemicals has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Mitsui Chemicals go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Mitsui Chemicals
Assuming the 90 days horizon Austevoll Seafood ASA is expected to generate 0.78 times more return on investment than Mitsui Chemicals. However, Austevoll Seafood ASA is 1.29 times less risky than Mitsui Chemicals. It trades about 0.24 of its potential returns per unit of risk. Mitsui Chemicals is currently generating about 0.05 per unit of risk. If you would invest 782.00 in Austevoll Seafood ASA on September 3, 2024 and sell it today you would earn a total of 73.00 from holding Austevoll Seafood ASA or generate 9.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Austevoll Seafood ASA vs. Mitsui Chemicals
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Mitsui Chemicals |
Austevoll Seafood and Mitsui Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Mitsui Chemicals
The main advantage of trading using opposite Austevoll Seafood and Mitsui Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Mitsui Chemicals 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 Mitsui Chemicals will offset losses from the drop in Mitsui Chemicals' long position.| Austevoll Seafood vs. Infrastrutture Wireless Italiane | Austevoll Seafood vs. Tower One Wireless | Austevoll Seafood vs. 24SEVENOFFICE GROUP AB | Austevoll Seafood vs. MINCO SILVER |
| Mitsui Chemicals vs. DXC Technology Co | Mitsui Chemicals vs. Computer And Technologies | Mitsui Chemicals vs. SCOTT TECHNOLOGY | Mitsui Chemicals vs. Casio Computer CoLtd |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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