Correlation Between ChampionX and SBM Offshore
Can any of the company-specific risk be diversified away by investing in both ChampionX 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 ChampionX and SBM Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChampionX and SBM Offshore NV, you can compare the effects of market volatilities on ChampionX 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 ChampionX with a short position of SBM Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChampionX and SBM Offshore.
Diversification Opportunities for ChampionX and SBM Offshore
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ChampionX and SBM is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding ChampionX and SBM Offshore NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBM Offshore NV and ChampionX 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 ChampionX 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 NV has no effect on the direction of ChampionX i.e., ChampionX and SBM Offshore go up and down completely randomly.
Pair Corralation between ChampionX and SBM Offshore
Considering the 90-day investment horizon ChampionX is expected to generate 4.66 times more return on investment than SBM Offshore. However, ChampionX is 4.66 times more volatile than SBM Offshore NV. It trades about 0.12 of its potential returns per unit of risk. SBM Offshore NV is currently generating about 0.25 per unit of risk. If you would invest 2,721 in ChampionX on November 3, 2024 and sell it today you would earn a total of 143.00 from holding ChampionX or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChampionX vs. SBM Offshore NV
Performance |
| Timeline |
| ChampionX |
| SBM Offshore NV |
ChampionX and SBM Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChampionX and SBM Offshore
The main advantage of trading using opposite ChampionX and SBM Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChampionX 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.| ChampionX vs. Expro Group Holdings | ChampionX vs. Ranger Energy Services | ChampionX vs. Cactus Inc | ChampionX vs. MRC Global |
| SBM Offshore vs. Expro Group Holdings | SBM Offshore vs. ChampionX | SBM Offshore vs. Ranger Energy Services | SBM Offshore vs. Cactus 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |