Correlation Between AUSTEVOLL SEAFOOD and New Residential
Can any of the company-specific risk be diversified away by investing in both AUSTEVOLL SEAFOOD and New Residential 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 New Residential into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AUSTEVOLL SEAFOOD and New Residential Investment, you can compare the effects of market volatilities on AUSTEVOLL SEAFOOD and New Residential 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 New Residential. Check out your portfolio center. Please also check ongoing floating volatility patterns of AUSTEVOLL SEAFOOD and New Residential.
Diversification Opportunities for AUSTEVOLL SEAFOOD and New Residential
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between AUSTEVOLL and New is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding AUSTEVOLL SEAFOOD and New Residential Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Residential Inve 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 are associated (or correlated) with New Residential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Residential Inve has no effect on the direction of AUSTEVOLL SEAFOOD i.e., AUSTEVOLL SEAFOOD and New Residential go up and down completely randomly.
Pair Corralation between AUSTEVOLL SEAFOOD and New Residential
Assuming the 90 days trading horizon AUSTEVOLL SEAFOOD is expected to generate 5.55 times more return on investment than New Residential. However, AUSTEVOLL SEAFOOD is 5.55 times more volatile than New Residential Investment. It trades about 0.07 of its potential returns per unit of risk. New Residential Investment is currently generating about 0.09 per unit of risk. If you would invest 270.00 in AUSTEVOLL SEAFOOD on August 28, 2024 and sell it today you would earn a total of 596.00 from holding AUSTEVOLL SEAFOOD or generate 220.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
AUSTEVOLL SEAFOOD vs. New Residential Investment
Performance |
| Timeline |
| AUSTEVOLL SEAFOOD |
| New Residential Inve |
AUSTEVOLL SEAFOOD and New Residential Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AUSTEVOLL SEAFOOD and New Residential
The main advantage of trading using opposite AUSTEVOLL SEAFOOD and New Residential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AUSTEVOLL SEAFOOD position performs unexpectedly, New Residential 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 New Residential will offset losses from the drop in New Residential's long position.| AUSTEVOLL SEAFOOD vs. TITAN MACHINERY | AUSTEVOLL SEAFOOD vs. ADRIATIC METALS LS 013355 | AUSTEVOLL SEAFOOD vs. GREENX METALS LTD | AUSTEVOLL SEAFOOD vs. Granite Construction |
| New Residential vs. Xtrackers ShortDAX | New Residential vs. Xtrackers LevDAX | New Residential vs. Lyxor 1 |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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