Correlation Between AUSTEVOLL SEAFOOD and SLR Investment
Can any of the company-specific risk be diversified away by investing in both AUSTEVOLL SEAFOOD and SLR Investment 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 SLR Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AUSTEVOLL SEAFOOD and SLR Investment Corp, you can compare the effects of market volatilities on AUSTEVOLL SEAFOOD and SLR Investment 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 SLR Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of AUSTEVOLL SEAFOOD and SLR Investment.
Diversification Opportunities for AUSTEVOLL SEAFOOD and SLR Investment
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AUSTEVOLL and SLR is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding AUSTEVOLL SEAFOOD and SLR Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLR Investment Corp 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 SLR Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLR Investment Corp has no effect on the direction of AUSTEVOLL SEAFOOD i.e., AUSTEVOLL SEAFOOD and SLR Investment go up and down completely randomly.
Pair Corralation between AUSTEVOLL SEAFOOD and SLR Investment
Assuming the 90 days trading horizon AUSTEVOLL SEAFOOD is expected to generate 1.3 times less return on investment than SLR Investment. But when comparing it to its historical volatility, AUSTEVOLL SEAFOOD is 1.4 times less risky than SLR Investment. It trades about 0.28 of its potential returns per unit of risk. SLR Investment Corp is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 1,404 in SLR Investment Corp on September 1, 2024 and sell it today you would earn a total of 161.00 from holding SLR Investment Corp or generate 11.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AUSTEVOLL SEAFOOD vs. SLR Investment Corp
Performance |
| Timeline |
| AUSTEVOLL SEAFOOD |
| SLR Investment Corp |
AUSTEVOLL SEAFOOD and SLR Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AUSTEVOLL SEAFOOD and SLR Investment
The main advantage of trading using opposite AUSTEVOLL SEAFOOD and SLR Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AUSTEVOLL SEAFOOD position performs unexpectedly, SLR Investment 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 SLR Investment will offset losses from the drop in SLR Investment's long position.| AUSTEVOLL SEAFOOD vs. ETFS Coffee ETC | AUSTEVOLL SEAFOOD vs. Texas Roadhouse | AUSTEVOLL SEAFOOD vs. QUEEN S ROAD | AUSTEVOLL SEAFOOD vs. Spirent Communications plc |
| SLR Investment vs. Ameriprise Financial | SLR Investment vs. Ares Management Corp | SLR Investment vs. Superior Plus Corp | SLR Investment vs. NMI Holdings |
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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