Correlation Between Worley Parsons and Akastor ASA

Can any of the company-specific risk be diversified away by investing in both Worley Parsons and Akastor 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 Worley Parsons and Akastor ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Worley Parsons and Akastor ASA

0.4

Correlation Coefficient

Worley Parsons  Akastor ASA

Very weak diversification

The 3 months correlation between Worley and Akastor is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Worley Parsons and Akastor ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akastor ASA and Worley Parsons 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 Worley Parsons are associated (or correlated) with Akastor ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akastor ASA has no effect on the direction of Worley Parsons i.e., Worley Parsons and Akastor ASA go up and down completely randomly.

Pair Corralation between Worley Parsons and Akastor ASA

Assuming the 90 days horizon Worley Parsons is expected to generate 3.06 times more return on investment than Akastor ASA. However, Worley Parsons is 3.06 times more volatile than Akastor ASA. It trades about -0.01 of its potential returns per unit of risk. Akastor ASA is currently generating about -0.12 per unit of risk. If you would invest  973.00  in Worley Parsons on September 29, 2024 and sell it today you would lose (123.00) from holding Worley Parsons or give up 12.64% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.21%
Values	Daily Returns

Worley Parsons  vs.  Akastor ASA

Worley Parsons

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Worley Parsons has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Akastor ASA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Akastor ASA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Worley Parsons and Akastor ASA

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

The idea behind Worley Parsons and Akastor 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.