Correlation Between BW Offshore and EvoAir Holdings
Can any of the company-specific risk be diversified away by investing in both BW Offshore and EvoAir Holdings 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 BW Offshore and EvoAir Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BW Offshore Limited and EvoAir Holdings, you can compare the effects of market volatilities on BW Offshore and EvoAir Holdings 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 BW Offshore with a short position of EvoAir Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of BW Offshore and EvoAir Holdings.
Diversification Opportunities for BW Offshore and EvoAir Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BWOFY and EvoAir is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BW Offshore Limited and EvoAir Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EvoAir Holdings and BW 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 BW Offshore Limited are associated (or correlated) with EvoAir Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EvoAir Holdings has no effect on the direction of BW Offshore i.e., BW Offshore and EvoAir Holdings go up and down completely randomly.
Pair Corralation between BW Offshore and EvoAir Holdings
Assuming the 90 days horizon BW Offshore Limited is expected to generate 6.16 times more return on investment than EvoAir Holdings. However, BW Offshore is 6.16 times more volatile than EvoAir Holdings. It trades about 0.04 of its potential returns per unit of risk. EvoAir Holdings is currently generating about 0.06 per unit of risk. If you would invest 433.00 in BW Offshore Limited on November 3, 2024 and sell it today you would earn a total of 68.00 from holding BW Offshore Limited or generate 15.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BW Offshore Limited vs. EvoAir Holdings
Performance |
| Timeline |
| BW Offshore Limited |
| EvoAir Holdings |
BW Offshore and EvoAir Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BW Offshore and EvoAir Holdings
The main advantage of trading using opposite BW Offshore and EvoAir Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BW Offshore position performs unexpectedly, EvoAir Holdings 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 EvoAir Holdings will offset losses from the drop in EvoAir Holdings' long position.| BW Offshore vs. Allient | BW Offshore vs. Analog Devices | BW Offshore vs. Alvotech | BW Offshore vs. Western Digital |
| EvoAir Holdings vs. Verde Clean Fuels | EvoAir Holdings vs. US Global Investors | EvoAir Holdings vs. Capital Clean Energy | EvoAir Holdings vs. China Clean Energy |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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