Correlation Between SBM Offshore and Datagroup
Can any of the company-specific risk be diversified away by investing in both SBM Offshore and Datagroup 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 SBM Offshore and Datagroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SBM Offshore NV and Datagroup SE, you can compare the effects of market volatilities on SBM Offshore and Datagroup 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 SBM Offshore with a short position of Datagroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBM Offshore and Datagroup.
Diversification Opportunities for SBM Offshore and Datagroup
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between SBM and Datagroup is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding SBM Offshore NV and Datagroup SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Datagroup SE and SBM 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 SBM Offshore NV are associated (or correlated) with Datagroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Datagroup SE has no effect on the direction of SBM Offshore i.e., SBM Offshore and Datagroup go up and down completely randomly.
Pair Corralation between SBM Offshore and Datagroup
Assuming the 90 days trading horizon SBM Offshore NV is expected to generate 0.81 times more return on investment than Datagroup. However, SBM Offshore NV is 1.24 times less risky than Datagroup. It trades about 0.09 of its potential returns per unit of risk. Datagroup SE is currently generating about 0.0 per unit of risk. If you would invest 1,164 in SBM Offshore NV on September 14, 2024 and sell it today you would earn a total of 518.00 from holding SBM Offshore NV or generate 44.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.55% |
| Values | Daily Returns |
SBM Offshore NV vs. Datagroup SE
Performance |
| Timeline |
| SBM Offshore NV |
| Datagroup SE |
SBM Offshore and Datagroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBM Offshore and Datagroup
The main advantage of trading using opposite SBM Offshore and Datagroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBM Offshore position performs unexpectedly, Datagroup 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 Datagroup will offset losses from the drop in Datagroup's long position.| SBM Offshore vs. Made Tech Group | SBM Offshore vs. Roper Technologies | SBM Offshore vs. LPKF Laser Electronics | SBM Offshore vs. Electronic Arts |
| Datagroup vs. Monster Beverage Corp | Datagroup vs. Allianz Technology Trust | Datagroup vs. Flow Traders NV | Datagroup vs. Albion Technology General |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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