Correlation Between Fidelity Sustainable and Grieg Seafood

Can any of the company-specific risk be diversified away by investing in both Fidelity Sustainable and Grieg Seafood 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 Fidelity Sustainable and Grieg Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fidelity Sustainable USD and Grieg Seafood, you can compare the effects of market volatilities on Fidelity Sustainable and Grieg Seafood 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 Fidelity Sustainable with a short position of Grieg Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Sustainable and Grieg Seafood.

Diversification Opportunities for Fidelity Sustainable and Grieg Seafood

-0.73

Correlation Coefficient

Fidelity Sustainable  Grieg Seafood

Pay attention - limited upside

The 3 months correlation between Fidelity and Grieg is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Sustainable USD and Grieg Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grieg Seafood and Fidelity Sustainable 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 Fidelity Sustainable USD are associated (or correlated) with Grieg Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grieg Seafood has no effect on the direction of Fidelity Sustainable i.e., Fidelity Sustainable and Grieg Seafood go up and down completely randomly.

Pair Corralation between Fidelity Sustainable and Grieg Seafood

Assuming the 90 days trading horizon Fidelity Sustainable is expected to generate 313.37 times less return on investment than Grieg Seafood. But when comparing it to its historical volatility, Fidelity Sustainable USD is 4.95 times less risky than Grieg Seafood. It trades about 0.0 of its potential returns per unit of risk. Grieg Seafood is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  5,728  in Grieg Seafood on September 13, 2024 and sell it today you would earn a total of  932.00  from holding Grieg Seafood or generate 16.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Fidelity Sustainable USD  vs.  Grieg Seafood

Fidelity Sustainable USD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fidelity Sustainable USD has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Fidelity Sustainable is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Grieg Seafood

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Grieg Seafood are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Grieg Seafood unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fidelity Sustainable and Grieg Seafood

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

The idea behind Fidelity Sustainable USD and Grieg Seafood 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.

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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.