Correlation Between EIDESVIK OFFSHORE and Nib Holdings
Can any of the company-specific risk be diversified away by investing in both EIDESVIK OFFSHORE and Nib 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 EIDESVIK OFFSHORE and Nib Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EIDESVIK OFFSHORE NK and nib holdings limited, you can compare the effects of market volatilities on EIDESVIK OFFSHORE and Nib 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 EIDESVIK OFFSHORE with a short position of Nib Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIDESVIK OFFSHORE and Nib Holdings.
Diversification Opportunities for EIDESVIK OFFSHORE and Nib Holdings
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between EIDESVIK and Nib is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding EIDESVIK OFFSHORE NK and nib holdings limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on nib holdings limited and EIDESVIK 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 EIDESVIK OFFSHORE NK are associated (or correlated) with Nib Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of nib holdings limited has no effect on the direction of EIDESVIK OFFSHORE i.e., EIDESVIK OFFSHORE and Nib Holdings go up and down completely randomly.
Pair Corralation between EIDESVIK OFFSHORE and Nib Holdings
Assuming the 90 days horizon EIDESVIK OFFSHORE NK is expected to generate 1.58 times more return on investment than Nib Holdings. However, EIDESVIK OFFSHORE is 1.58 times more volatile than nib holdings limited. It trades about 0.05 of its potential returns per unit of risk. nib holdings limited is currently generating about -0.01 per unit of risk. If you would invest 70.00 in EIDESVIK OFFSHORE NK on October 7, 2024 and sell it today you would earn a total of 44.00 from holding EIDESVIK OFFSHORE NK or generate 62.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EIDESVIK OFFSHORE NK vs. nib holdings limited
Performance |
| Timeline |
| EIDESVIK OFFSHORE |
| nib holdings limited |
EIDESVIK OFFSHORE and Nib Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIDESVIK OFFSHORE and Nib Holdings
The main advantage of trading using opposite EIDESVIK OFFSHORE and Nib Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIDESVIK OFFSHORE position performs unexpectedly, Nib 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 Nib Holdings will offset losses from the drop in Nib Holdings' long position.| EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc |
| Nib Holdings vs. PLAYTIKA HOLDING DL 01 | Nib Holdings vs. DATA MODUL | Nib Holdings vs. VIAPLAY GROUP AB | Nib Holdings vs. Data Modul AG |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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