Correlation Between Austevoll Seafood and SLC Agricola

Can any of the company-specific risk be diversified away by investing in both Austevoll Seafood and SLC Agricola 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 SLC Agricola 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 SLC Agricola SA, you can compare the effects of market volatilities on Austevoll Seafood and SLC Agricola 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 SLC Agricola. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austevoll Seafood and SLC Agricola.

Diversification Opportunities for Austevoll Seafood and SLC Agricola

0.03

Correlation Coefficient

Austevoll Seafood  SLC Agricola

Significant diversification

The 3 months correlation between Austevoll and SLC is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and SLC Agricola SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLC Agricola SA 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 SLC Agricola. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLC Agricola SA has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and SLC Agricola go up and down completely randomly.

Pair Corralation between Austevoll Seafood and SLC Agricola

Assuming the 90 days horizon Austevoll Seafood ASA is expected to generate 0.37 times more return on investment than SLC Agricola. However, Austevoll Seafood ASA is 2.73 times less risky than SLC Agricola. It trades about 0.06 of its potential returns per unit of risk. SLC Agricola SA is currently generating about 0.01 per unit of risk. If you would invest  855.00  in Austevoll Seafood ASA on September 14, 2024 and sell it today you would earn a total of  25.00  from holding Austevoll Seafood ASA or generate 2.92% return on investment over 90 days.

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

Austevoll Seafood ASA  vs.  SLC Agricola SA

Austevoll Seafood ASA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Austevoll Seafood ASA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. 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.

SLC Agricola SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SLC Agricola SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward-looking indicators, SLC Agricola is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Austevoll Seafood and SLC Agricola

The main advantage of trading using opposite Austevoll Seafood and SLC Agricola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austevoll Seafood position performs unexpectedly, SLC Agricola 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 SLC Agricola will offset losses from the drop in SLC Agricola's long position.

The idea behind Austevoll Seafood ASA and SLC Agricola SA 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.