Correlation Between Yara International and Polaris Media

Can any of the company-specific risk be diversified away by investing in both Yara International and Polaris Media 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 Yara International and Polaris Media into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Yara International and Polaris Media

-0.69

Correlation Coefficient

Yara International  Polaris Media

Excellent diversification

The 3 months correlation between Yara and Polaris is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Yara International ASA and Polaris Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polaris Media and Yara International 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 Yara International ASA are associated (or correlated) with Polaris Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polaris Media has no effect on the direction of Yara International i.e., Yara International and Polaris Media go up and down completely randomly.

Pair Corralation between Yara International and Polaris Media

Assuming the 90 days trading horizon Yara International ASA is expected to generate 0.6 times more return on investment than Polaris Media. However, Yara International ASA is 1.68 times less risky than Polaris Media. It trades about 0.2 of its potential returns per unit of risk. Polaris Media is currently generating about -0.05 per unit of risk. If you would invest  33,388  in Yara International ASA on April 25, 2025 and sell it today you would earn a total of  5,632  from holding Yara International ASA or generate 16.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Yara International ASA  vs.  Polaris Media

Yara International ASA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Yara International ASA are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Yara International disclosed solid returns over the last few months and may actually be approaching a breakup point.

Polaris Media

Risk-Adjusted Performance

Very Weak

Over the last 90 days Polaris Media has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's essential indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Yara International and Polaris Media

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

The idea behind Yara International ASA and Polaris Media 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.