Correlation Between Austevoll Seafood and Techstep ASA

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

Diversification Opportunities for Austevoll Seafood and Techstep ASA

0.0

Correlation Coefficient

Austevoll Seafood  Techstep ASA

Pay attention - limited upside

The 3 months correlation between Austevoll and Techstep is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Austevoll Seafood ASA and Techstep ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Techstep ASA 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 Techstep ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Techstep ASA has no effect on the direction of Austevoll Seafood i.e., Austevoll Seafood and Techstep ASA go up and down completely randomly.

Pair Corralation between Austevoll Seafood and Techstep ASA

Assuming the 90 days trading horizon Austevoll Seafood is expected to generate 1.66 times less return on investment than Techstep ASA. But when comparing it to its historical volatility, Austevoll Seafood ASA is 2.05 times less risky than Techstep ASA. It trades about 0.04 of its potential returns per unit of risk. Techstep ASA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,060  in Techstep ASA on October 27, 2024 and sell it today you would earn a total of  300.00  from holding Techstep ASA or generate 28.3% return on investment over 90 days.

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

Austevoll Seafood ASA  vs.  Techstep ASA

Austevoll Seafood ASA

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Austevoll Seafood ASA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting essential indicators, Austevoll Seafood may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Techstep ASA

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Techstep ASA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting essential indicators, Techstep ASA may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Austevoll Seafood and Techstep ASA

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

The idea behind Austevoll Seafood ASA and Techstep 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.