Correlation Between OCADO GROUP and SBM OFFSHORE
Can any of the company-specific risk be diversified away by investing in both OCADO GROUP and SBM OFFSHORE 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 OCADO GROUP and SBM OFFSHORE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OCADO GROUP and SBM OFFSHORE, you can compare the effects of market volatilities on OCADO GROUP and SBM OFFSHORE 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 OCADO GROUP with a short position of SBM OFFSHORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of OCADO GROUP and SBM OFFSHORE.
Diversification Opportunities for OCADO GROUP and SBM OFFSHORE
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OCADO and SBM is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding OCADO GROUP and SBM OFFSHORE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBM OFFSHORE and OCADO GROUP 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 OCADO GROUP are associated (or correlated) with SBM OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBM OFFSHORE has no effect on the direction of OCADO GROUP i.e., OCADO GROUP and SBM OFFSHORE go up and down completely randomly.
Pair Corralation between OCADO GROUP and SBM OFFSHORE
Assuming the 90 days trading horizon OCADO GROUP is expected to under-perform the SBM OFFSHORE. In addition to that, OCADO GROUP is 2.51 times more volatile than SBM OFFSHORE. It trades about -0.03 of its total potential returns per unit of risk. SBM OFFSHORE is currently generating about 0.06 per unit of volatility. If you would invest 1,243 in SBM OFFSHORE on September 12, 2024 and sell it today you would earn a total of 455.00 from holding SBM OFFSHORE or generate 36.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
OCADO GROUP vs. SBM OFFSHORE
Performance |
| Timeline |
| OCADO GROUP |
| SBM OFFSHORE |
OCADO GROUP and SBM OFFSHORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OCADO GROUP and SBM OFFSHORE
The main advantage of trading using opposite OCADO GROUP and SBM OFFSHORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OCADO GROUP position performs unexpectedly, SBM OFFSHORE 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 SBM OFFSHORE will offset losses from the drop in SBM OFFSHORE's long position.| OCADO GROUP vs. SBM OFFSHORE | OCADO GROUP vs. PKSHA TECHNOLOGY INC | OCADO GROUP vs. SIEM OFFSHORE NEW | OCADO GROUP vs. UNITED RENTALS |
| SBM OFFSHORE vs. Apple Inc | SBM OFFSHORE vs. Apple Inc | SBM OFFSHORE vs. Apple Inc | SBM OFFSHORE vs. Apple Inc |
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.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |