Correlation Between Aegon NV and Solstad Offshore
Can any of the company-specific risk be diversified away by investing in both Aegon NV and Solstad 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 Aegon NV and Solstad Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegon NV ADR and Solstad Offshore ASA, you can compare the effects of market volatilities on Aegon NV and Solstad 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 Aegon NV with a short position of Solstad Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and Solstad Offshore.
Diversification Opportunities for Aegon NV and Solstad Offshore
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aegon and Solstad is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and Solstad Offshore ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solstad Offshore ASA and Aegon NV 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 Aegon NV ADR are associated (or correlated) with Solstad Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solstad Offshore ASA has no effect on the direction of Aegon NV i.e., Aegon NV and Solstad Offshore go up and down completely randomly.
Pair Corralation between Aegon NV and Solstad Offshore
Considering the 90-day investment horizon Aegon NV is expected to generate 3.28 times less return on investment than Solstad Offshore. But when comparing it to its historical volatility, Aegon NV ADR is 3.86 times less risky than Solstad Offshore. It trades about 0.06 of its potential returns per unit of risk. Solstad Offshore ASA is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 151.00 in Solstad Offshore ASA on September 12, 2024 and sell it today you would earn a total of 158.00 from holding Solstad Offshore ASA or generate 104.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Aegon NV ADR vs. Solstad Offshore ASA
Performance |
| Timeline |
| Aegon NV ADR |
| Solstad Offshore ASA |
Aegon NV and Solstad Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and Solstad Offshore
The main advantage of trading using opposite Aegon NV and Solstad Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, Solstad 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 Solstad Offshore will offset losses from the drop in Solstad Offshore's long position.| Aegon NV vs. Hartford Financial Services | Aegon NV vs. Goosehead Insurance | Aegon NV vs. International General Insurance | Aegon NV vs. Enstar Group Limited |
| Solstad Offshore vs. Kaltura | Solstad Offshore vs. Rackspace Technology | Solstad Offshore vs. United Homes Group | Solstad Offshore vs. Franklin Street Properties |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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