Correlation Between Solstad Offshore and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Solstad Offshore and Samsung Electronics 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 Solstad Offshore and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solstad Offshore ASA and Samsung Electronics Co, you can compare the effects of market volatilities on Solstad Offshore and Samsung Electronics 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 Solstad Offshore with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solstad Offshore and Samsung Electronics.
Diversification Opportunities for Solstad Offshore and Samsung Electronics
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Solstad and Samsung is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Solstad Offshore ASA and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Solstad Offshore 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 Solstad Offshore ASA are associated (or correlated) with Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of Solstad Offshore i.e., Solstad Offshore and Samsung Electronics go up and down completely randomly.
Pair Corralation between Solstad Offshore and Samsung Electronics
Assuming the 90 days trading horizon Solstad Offshore ASA is expected to generate 2.42 times more return on investment than Samsung Electronics. However, Solstad Offshore is 2.42 times more volatile than Samsung Electronics Co. It trades about 0.03 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.01 per unit of risk. If you would invest 3,069 in Solstad Offshore ASA on August 24, 2024 and sell it today you would earn a total of 861.00 from holding Solstad Offshore ASA or generate 28.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Solstad Offshore ASA vs. Samsung Electronics Co
Performance |
| Timeline |
| Solstad Offshore ASA |
| Samsung Electronics |
Solstad Offshore and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solstad Offshore and Samsung Electronics
The main advantage of trading using opposite Solstad Offshore and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solstad Offshore position performs unexpectedly, Samsung Electronics 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 Samsung Electronics will offset losses from the drop in Samsung Electronics' long position.| Solstad Offshore vs. Quadrise Plc | Solstad Offshore vs. Intuitive Investments Group | Solstad Offshore vs. European Metals Holdings | Solstad Offshore vs. Athelney Trust plc |
| Samsung Electronics vs. United Internet AG | Samsung Electronics vs. Fresenius Medical Care | Samsung Electronics vs. STMicroelectronics NV | Samsung Electronics vs. Medical Properties Trust |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |