Correlation Between SEGRO Plc and Yara International
Can any of the company-specific risk be diversified away by investing in both SEGRO Plc and Yara International 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 SEGRO Plc and Yara International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEGRO Plc and Yara International ASA, you can compare the effects of market volatilities on SEGRO Plc and Yara International 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 SEGRO Plc with a short position of Yara International. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEGRO Plc and Yara International.
Diversification Opportunities for SEGRO Plc and Yara International
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SEGRO and Yara is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding SEGRO Plc and Yara International ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yara International ASA and SEGRO Plc 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 SEGRO Plc are associated (or correlated) with Yara International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yara International ASA has no effect on the direction of SEGRO Plc i.e., SEGRO Plc and Yara International go up and down completely randomly.
Pair Corralation between SEGRO Plc and Yara International
Assuming the 90 days trading horizon SEGRO Plc is expected to generate 0.9 times more return on investment than Yara International. However, SEGRO Plc is 1.11 times less risky than Yara International. It trades about 0.02 of its potential returns per unit of risk. Yara International ASA is currently generating about 0.01 per unit of risk. If you would invest 796.00 in SEGRO Plc on December 28, 2024 and sell it today you would earn a total of 10.00 from holding SEGRO Plc or generate 1.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SEGRO Plc vs. Yara International ASA
Performance |
Timeline |
SEGRO Plc |
Yara International ASA |
SEGRO Plc and Yara International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SEGRO Plc and Yara International
The main advantage of trading using opposite SEGRO Plc and Yara International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEGRO Plc position performs unexpectedly, Yara International 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 Yara International will offset losses from the drop in Yara International's long position.SEGRO Plc vs. Information Services International Dentsu | SEGRO Plc vs. JAPAN TOBACCO UNSPADR12 | SEGRO Plc vs. Automatic Data Processing | SEGRO Plc vs. Burlington Stores |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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