Correlation Between Hunter Group and Var Energi
Can any of the company-specific risk be diversified away by investing in both Hunter Group and Var Energi 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 Hunter Group and Var Energi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hunter Group ASA and Var Energi ASA, you can compare the effects of market volatilities on Hunter Group and Var Energi 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 Hunter Group with a short position of Var Energi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunter Group and Var Energi.
Diversification Opportunities for Hunter Group and Var Energi
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hunter and Var is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Hunter Group ASA and Var Energi ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Var Energi ASA and Hunter Group 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 Hunter Group ASA are associated (or correlated) with Var Energi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Var Energi ASA has no effect on the direction of Hunter Group i.e., Hunter Group and Var Energi go up and down completely randomly.
Pair Corralation between Hunter Group and Var Energi
Assuming the 90 days trading horizon Hunter Group ASA is expected to under-perform the Var Energi. In addition to that, Hunter Group is 3.16 times more volatile than Var Energi ASA. It trades about -0.18 of its total potential returns per unit of risk. Var Energi ASA is currently generating about 0.1 per unit of volatility. If you would invest 3,238 in Var Energi ASA on September 6, 2024 and sell it today you would earn a total of 381.00 from holding Var Energi ASA or generate 11.77% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hunter Group ASA vs. Var Energi ASA
Performance |
Timeline |
Hunter Group ASA |
Var Energi ASA |
Hunter Group and Var Energi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hunter Group and Var Energi
The main advantage of trading using opposite Hunter Group and Var Energi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunter Group position performs unexpectedly, Var Energi 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 Var Energi will offset losses from the drop in Var Energi's long position.Hunter Group vs. Okeanis Eco Tankers | Hunter Group vs. Frontline | Hunter Group vs. BW LPG | Hunter Group vs. FLEX LNG |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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