Correlation Between Compugroup Medical and Eidesvik Offshore
Can any of the company-specific risk be diversified away by investing in both Compugroup Medical 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 Compugroup Medical and Eidesvik Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compugroup Medical SE and Eidesvik Offshore ASA, you can compare the effects of market volatilities on Compugroup Medical 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 Compugroup Medical with a short position of Eidesvik Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compugroup Medical and Eidesvik Offshore.
Diversification Opportunities for Compugroup Medical and Eidesvik Offshore
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Compugroup and Eidesvik is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Compugroup Medical SE 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 Compugroup Medical 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 Compugroup Medical SE 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 Compugroup Medical i.e., Compugroup Medical and Eidesvik Offshore go up and down completely randomly.
Pair Corralation between Compugroup Medical and Eidesvik Offshore
Assuming the 90 days horizon Compugroup Medical is expected to generate 3.72 times less return on investment than Eidesvik Offshore. But when comparing it to its historical volatility, Compugroup Medical SE is 3.81 times less risky than Eidesvik Offshore. It trades about 0.17 of its potential returns per unit of risk. Eidesvik Offshore ASA is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 109.00 in Eidesvik Offshore ASA on October 14, 2024 and sell it today you would earn a total of 8.00 from holding Eidesvik Offshore ASA or generate 7.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compugroup Medical SE vs. Eidesvik Offshore ASA
Performance |
| Timeline |
| Compugroup Medical |
| Eidesvik Offshore ASA |
Compugroup Medical and Eidesvik Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compugroup Medical and Eidesvik Offshore
The main advantage of trading using opposite Compugroup Medical and Eidesvik Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compugroup Medical 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.| Compugroup Medical vs. PLAYTECH | Compugroup Medical vs. ANTA SPORTS PRODUCT | Compugroup Medical vs. TRAVEL LEISURE DL 01 | Compugroup Medical vs. Thai Beverage Public |
| Eidesvik Offshore vs. PLAYMATES TOYS | Eidesvik Offshore vs. PEPTONIC MEDICAL | Eidesvik Offshore vs. SPECTRAL MEDICAL | Eidesvik Offshore vs. Compugroup Medical SE |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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