Correlation Between Saipem SpA and Akastor ASA

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

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

Diversification Opportunities for Saipem SpA and Akastor ASA

0.0

Correlation Coefficient

Saipem SpA  Akastor ASA

Pay attention - limited upside

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

Pair Corralation between Saipem SpA and Akastor ASA

If you would invest  110.00  in Akastor ASA on February 3, 2025 and sell it today you would earn a total of  0.00  from holding Akastor ASA or generate 0.0% return on investment over 90 days.

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

Saipem SpA  vs.  Akastor ASA

Saipem SpA

Risk-Adjusted Performance

Very Weak

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

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 Saipem SpA and Akastor ASA

The main advantage of trading using opposite Saipem SpA and Akastor ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saipem SpA 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 Saipem SpA 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.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.