Correlation Between SALMAR ASA and SPAREBANK

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both SALMAR ASA and 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 SALMAR ASA and SPAREBANK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SALMAR ASA and SPAREBANK 1 SMN, you can compare the effects of market volatilities on SALMAR ASA and 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 SALMAR ASA with a short position of SPAREBANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of SALMAR ASA and SPAREBANK.

Diversification Opportunities for SALMAR ASA and SPAREBANK

0.72
  Correlation Coefficient

Poor diversification

The 3 months correlation between SALMAR and SPAREBANK is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding SALMAR ASA and SPAREBANK 1 SMN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPAREBANK 1 SMN and SALMAR ASA 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 SALMAR ASA are associated (or correlated) with SPAREBANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPAREBANK 1 SMN has no effect on the direction of SALMAR ASA i.e., SALMAR ASA and SPAREBANK go up and down completely randomly.

Pair Corralation between SALMAR ASA and SPAREBANK

Assuming the 90 days trading horizon SALMAR ASA is expected to under-perform the SPAREBANK. In addition to that, SALMAR ASA is 1.95 times more volatile than SPAREBANK 1 SMN. It trades about -0.03 of its total potential returns per unit of risk. SPAREBANK 1 SMN is currently generating about 0.17 per unit of volatility. If you would invest  11,220  in SPAREBANK 1 SMN on September 1, 2022 and sell it today you would earn a total of  460.00  from holding SPAREBANK 1 SMN or generate 4.1% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

SALMAR ASA  vs.  SPAREBANK 1 SMN

 Performance (%) 
       Timeline  
SALMAR ASA 
SALMAR Performance
0 of 100
Over the last 90 days SALMAR ASA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's basic indicators remain relatively steady which may send shares a bit higher in December 2022. The new chaos may also be a sign of medium-term up-swing for the company stakeholders.

SALMAR Price Channel

SPAREBANK 1 SMN 
SPAREBANK Performance
0 of 100
Over the last 90 days SPAREBANK 1 SMN has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady basic indicators, SPAREBANK is not utilizing all of its potentials. The new stock price chaos, may contribute to medium-term losses for the stakeholders.

SPAREBANK Price Channel

SALMAR ASA and SPAREBANK Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SALMAR ASA and SPAREBANK

The main advantage of trading using opposite SALMAR ASA and SPAREBANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SALMAR ASA position performs unexpectedly, 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 SPAREBANK will offset losses from the drop in SPAREBANK's long position.
SALMAR ASA vs. PEXIP HOLDING ASA
The idea behind SALMAR ASA and SPAREBANK 1 SMN 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.
SPAREBANK vs. SPAREBANKEN MORE
SPAREBANK vs. PEXIP HOLDING ASA
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

Other Complementary Tools

Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Go
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Go
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Go
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Go
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Go
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Go
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Go
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Go
Watchlist Optimization
Optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm
Go
Analyst Recommendations
Analyst recommendations and target price estimates broken down by several categories
Go
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Go
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Go