Correlation Between Origin Agritech and Eidesvik Offshore
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and Eidesvik 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 Origin Agritech and Eidesvik Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and Eidesvik Offshore ASA, you can compare the effects of market volatilities on Origin Agritech and Eidesvik 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 Origin Agritech with a short position of Eidesvik Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Eidesvik Offshore.
Diversification Opportunities for Origin Agritech and Eidesvik Offshore
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Origin and Eidesvik is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and Eidesvik Offshore ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eidesvik Offshore ASA and Origin Agritech 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 Origin Agritech are associated (or correlated) with Eidesvik Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eidesvik Offshore ASA has no effect on the direction of Origin Agritech i.e., Origin Agritech and Eidesvik Offshore go up and down completely randomly.
Pair Corralation between Origin Agritech and Eidesvik Offshore
Assuming the 90 days trading horizon Origin Agritech is expected to generate 2.18 times more return on investment than Eidesvik Offshore. However, Origin Agritech is 2.18 times more volatile than Eidesvik Offshore ASA. It trades about 0.04 of its potential returns per unit of risk. Eidesvik Offshore ASA is currently generating about -0.09 per unit of risk. If you would invest 232.00 in Origin Agritech on September 4, 2024 and sell it today you would earn a total of 10.00 from holding Origin Agritech or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Origin Agritech vs. Eidesvik Offshore ASA
Performance |
| Timeline |
| Origin Agritech |
| Eidesvik Offshore ASA |
Origin Agritech and Eidesvik Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Eidesvik Offshore
The main advantage of trading using opposite Origin Agritech and Eidesvik Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, Eidesvik 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 Eidesvik Offshore will offset losses from the drop in Eidesvik Offshore's long position.| Origin Agritech vs. SMA Solar Technology | Origin Agritech vs. Aedas Homes SA | Origin Agritech vs. PKSHA TECHNOLOGY INC | Origin Agritech vs. Vishay Intertechnology |
| Eidesvik Offshore vs. Superior Plus Corp | Eidesvik Offshore vs. NMI Holdings | Eidesvik Offshore vs. Origin Agritech | Eidesvik Offshore vs. SIVERS SEMICONDUCTORS AB |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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