Correlation Between Clean Seas and Bien Sparebank
Can any of the company-specific risk be diversified away by investing in both Clean Seas and Bien Sparebank 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 Clean Seas and Bien Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clean Seas Seafood and Bien Sparebank ASA, you can compare the effects of market volatilities on Clean Seas and Bien Sparebank 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 Clean Seas with a short position of Bien Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clean Seas and Bien Sparebank.
Diversification Opportunities for Clean Seas and Bien Sparebank
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Clean and Bien is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Clean Seas Seafood and Bien Sparebank ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bien Sparebank ASA and Clean Seas 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 Clean Seas Seafood are associated (or correlated) with Bien Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bien Sparebank ASA has no effect on the direction of Clean Seas i.e., Clean Seas and Bien Sparebank go up and down completely randomly.
Pair Corralation between Clean Seas and Bien Sparebank
Assuming the 90 days trading horizon Clean Seas Seafood is expected to under-perform the Bien Sparebank. In addition to that, Clean Seas is 2.17 times more volatile than Bien Sparebank ASA. It trades about -0.26 of its total potential returns per unit of risk. Bien Sparebank ASA is currently generating about 0.2 per unit of volatility. If you would invest 9,300 in Bien Sparebank ASA on September 26, 2024 and sell it today you would earn a total of 2,400 from holding Bien Sparebank ASA or generate 25.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Clean Seas Seafood vs. Bien Sparebank ASA
Performance |
Timeline |
Clean Seas Seafood |
Bien Sparebank ASA |
Clean Seas and Bien Sparebank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Clean Seas and Bien Sparebank
The main advantage of trading using opposite Clean Seas and Bien Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clean Seas position performs unexpectedly, Bien Sparebank 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 Bien Sparebank will offset losses from the drop in Bien Sparebank's long position.Clean Seas vs. Masoval AS | Clean Seas vs. Andfjord Salmon AS | Clean Seas vs. Arctic Fish Holding | Clean Seas vs. Ice Fish Farm |
Bien Sparebank vs. Morrow Bank ASA | Bien Sparebank vs. Skue Sparebank | Bien Sparebank vs. Romsdal Sparebank | Bien Sparebank vs. Shelf Drilling |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |