Correlation Between TechnipFMC PLC and Akastor ASA

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

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

Diversification Opportunities for TechnipFMC PLC and Akastor ASA

0.0

Correlation Coefficient

TechnipFMC PLC  Akastor ASA

Pay attention - limited upside

The 3 months correlation between TechnipFMC and Akastor is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TechnipFMC PLC and Akastor ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akastor ASA and TechnipFMC 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 TechnipFMC PLC 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 TechnipFMC PLC i.e., TechnipFMC PLC and Akastor ASA go up and down completely randomly.

Pair Corralation between TechnipFMC PLC and Akastor ASA

If you would invest  3,010  in TechnipFMC PLC on February 3, 2025 and sell it today you would lose (43.00) from holding TechnipFMC PLC or give up 1.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

TechnipFMC PLC  vs.  Akastor ASA

TechnipFMC PLC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TechnipFMC PLC are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, TechnipFMC PLC is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Akastor ASA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Akastor ASA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Akastor ASA is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with TechnipFMC PLC and Akastor ASA

The main advantage of trading using opposite TechnipFMC PLC and Akastor ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TechnipFMC PLC 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 TechnipFMC PLC 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.