Correlation Between Austevoll Seafood and Retail Estates
Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and Retail Estates 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 Retail Estates 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 Retail Estates NV, you can compare the effects of market volatilities on Austevoll Seafood and Retail Estates 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 Retail Estates. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and Retail Estates.
Diversification Opportunities for Austevoll Seafood and Retail Estates
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Austevoll and Retail is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Retail Estates NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retail Estates NV 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 Retail Estates. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retail Estates NV has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Retail Estates go up and down completely randomly.
Pair Corralation between Austevoll Seafood and Retail Estates
Assuming the 90 days horizon Austevoll Seafood is expected to generate 11.84 times less return on investment than Retail Estates. In addition to that, Austevoll Seafood is 2.45 times more volatile than Retail Estates NV. It trades about 0.01 of its total potential returns per unit of risk. Retail Estates NV is currently generating about 0.17 per unit of volatility. If you would invest 5,800 in Retail Estates NV on October 8, 2024 and sell it today you would earn a total of 160.00 from holding Retail Estates NV or generate 2.76% 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. Retail Estates NV
Performance |
| Timeline |
| Austevoll Seafood ASA |
| Retail Estates NV |
Austevoll Seafood and Retail Estates Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austevoll Seafood and Retail Estates
The main advantage of trading using opposite Austevoll Seafood and Retail Estates positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, Retail Estates 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 Retail Estates will offset losses from the drop in Retail Estates' long position.| Austevoll Seafood vs. CAIRN HOMES EO | Austevoll Seafood vs. Focus Home Interactive | Austevoll Seafood vs. Beazer Homes USA | Austevoll Seafood vs. CITY OFFICE REIT |
| Retail Estates vs. Superior Plus Corp | Retail Estates vs. NMI Holdings | Retail Estates vs. SIVERS SEMICONDUCTORS AB | Retail Estates vs. Talanx AG |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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