Correlation Between Lery Seafood and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both Lery Seafood and Austevoll Seafood 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 Lery Seafood and Austevoll Seafood 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 Austevoll Seafood ASA, you can compare the effects of market volatilities on Lery Seafood and Austevoll Seafood 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 Lery Seafood with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lery Seafood and Austevoll Seafood.
Diversification Opportunities for Lery Seafood and Austevoll Seafood
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lery and Austevoll is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Lery Seafood Group and Austevoll Seafood ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austevoll Seafood ASA and Lery 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 Austevoll Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austevoll Seafood ASA has no effect on the direction of Lery Seafood i.e., Lery Seafood and Austevoll Seafood go up and down completely randomly.
Pair Corralation between Lery Seafood and Austevoll Seafood
Assuming the 90 days trading horizon Lery Seafood Group is expected to under-perform the Austevoll Seafood. But the stock apears to be less risky and, when comparing its historical volatility, Lery Seafood Group is 1.15 times less risky than Austevoll Seafood. The stock trades about -0.3 of its potential returns per unit of risk. The Austevoll Seafood ASA is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 8,420 in Austevoll Seafood ASA on January 20, 2024 and sell it today you would lose (110.00) from holding Austevoll Seafood ASA or give up 1.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lery Seafood Group vs. Austevoll Seafood ASA
Performance |
| Timeline |
| Lery Seafood Group |
| Austevoll Seafood ASA |
Lery Seafood and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lery Seafood and Austevoll Seafood
The main advantage of trading using opposite Lery Seafood and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lery Seafood position performs unexpectedly, Austevoll Seafood 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 Austevoll Seafood will offset losses from the drop in Austevoll Seafood's long position.| Lery Seafood vs. Telenor ASA | Lery Seafood vs. DnB ASA | Lery Seafood vs. Yara International ASA | Lery Seafood vs. Storebrand ASA |
| Austevoll Seafood vs. Telenor ASA | Austevoll Seafood vs. DnB ASA | Austevoll Seafood vs. Yara International ASA | Austevoll Seafood vs. Storebrand ASA |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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