Correlation Between Itera ASA and Crayon Group

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

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

Diversification Opportunities for Itera ASA and Crayon Group

0.5

Correlation Coefficient

Itera ASA  Crayon Group

Very weak diversification

The 3 months correlation between Itera and Crayon is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Itera ASA and Crayon Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crayon Group Holding and Itera 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 Itera ASA are associated (or correlated) with Crayon Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crayon Group Holding has no effect on the direction of Itera ASA i.e., Itera ASA and Crayon Group go up and down completely randomly.

Pair Corralation between Itera ASA and Crayon Group

Assuming the 90 days trading horizon Itera ASA is expected to generate 16.99 times less return on investment than Crayon Group. In addition to that, Itera ASA is 1.74 times more volatile than Crayon Group Holding. It trades about 0.01 of its total potential returns per unit of risk. Crayon Group Holding is currently generating about 0.24 per unit of volatility. If you would invest  11,630  in Crayon Group Holding on April 23, 2025 and sell it today you would earn a total of  2,770  from holding Crayon Group Holding or generate 23.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	88.71%
Values	Daily Returns

Itera ASA  vs.  Crayon Group Holding

Itera ASA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Itera ASA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Itera ASA is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Crayon Group Holding

Risk-Adjusted Performance

Solid

Over the last 90 days Crayon Group Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very unfluctuating basic indicators, Crayon Group displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Itera ASA and Crayon Group

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

The idea behind Itera ASA and Crayon Group Holding 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 CEOs Directory module to screen CEOs from public companies around the world.