Correlation Between Sartorius Stedim and Austevoll Seafood

Can any of the company-specific risk be diversified away by investing in both Sartorius Stedim 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 Sartorius Stedim and Austevoll Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sartorius Stedim Biotech and Austevoll Seafood ASA, you can compare the effects of market volatilities on Sartorius Stedim 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 Sartorius Stedim with a short position of Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sartorius Stedim and Austevoll Seafood.

Diversification Opportunities for Sartorius Stedim and Austevoll Seafood

-0.09

Correlation Coefficient

Sartorius Stedim  Austevoll Seafood

Good diversification

The 3 months correlation between Sartorius and Austevoll is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Sartorius Stedim Biotech 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 Sartorius Stedim 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 Sartorius Stedim Biotech 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 Sartorius Stedim i.e., Sartorius Stedim and Austevoll Seafood go up and down completely randomly.

Pair Corralation between Sartorius Stedim and Austevoll Seafood

Assuming the 90 days trading horizon Sartorius Stedim Biotech is expected to under-perform the Austevoll Seafood. But the stock apears to be less risky and, when comparing its historical volatility, Sartorius Stedim Biotech is 1.93 times less risky than Austevoll Seafood. The stock trades about -0.02 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  327.00  in Austevoll Seafood ASA on October 5, 2024 and sell it today you would earn a total of  495.00  from holding Austevoll Seafood ASA or generate 151.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Sartorius Stedim Biotech  vs.  Austevoll Seafood ASA

Sartorius Stedim Biotech

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Sartorius Stedim Biotech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Sartorius Stedim is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Austevoll Seafood ASA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Austevoll Seafood ASA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Austevoll Seafood is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Sartorius Stedim and Austevoll Seafood

The main advantage of trading using opposite Sartorius Stedim and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sartorius Stedim 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.

The idea behind Sartorius Stedim Biotech and Austevoll Seafood ASA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.