Correlation Between EIDESVIK OFFSHORE and USWE SPORTS
Can any of the company-specific risk be diversified away by investing in both EIDESVIK OFFSHORE and USWE SPORTS 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 USWE SPORTS 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 USWE SPORTS AB, you can compare the effects of market volatilities on EIDESVIK OFFSHORE and USWE SPORTS 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 USWE SPORTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIDESVIK OFFSHORE and USWE SPORTS.
Diversification Opportunities for EIDESVIK OFFSHORE and USWE SPORTS
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EIDESVIK and USWE is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding EIDESVIK OFFSHORE NK and USWE SPORTS AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USWE SPORTS AB 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 USWE SPORTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USWE SPORTS AB has no effect on the direction of EIDESVIK OFFSHORE i.e., EIDESVIK OFFSHORE and USWE SPORTS go up and down completely randomly.
Pair Corralation between EIDESVIK OFFSHORE and USWE SPORTS
Assuming the 90 days horizon EIDESVIK OFFSHORE NK is expected to under-perform the USWE SPORTS. In addition to that, EIDESVIK OFFSHORE is 1.54 times more volatile than USWE SPORTS AB. It trades about -0.07 of its total potential returns per unit of risk. USWE SPORTS AB is currently generating about -0.05 per unit of volatility. If you would invest 76.00 in USWE SPORTS AB on September 21, 2024 and sell it today you would lose (2.00) from holding USWE SPORTS AB or give up 2.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EIDESVIK OFFSHORE NK vs. USWE SPORTS AB
Performance |
| Timeline |
| EIDESVIK OFFSHORE |
| USWE SPORTS AB |
EIDESVIK OFFSHORE and USWE SPORTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIDESVIK OFFSHORE and USWE SPORTS
The main advantage of trading using opposite EIDESVIK OFFSHORE and USWE SPORTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIDESVIK OFFSHORE position performs unexpectedly, USWE SPORTS 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 USWE SPORTS will offset losses from the drop in USWE SPORTS's long position.| EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc |
| USWE SPORTS vs. DIVERSIFIED ROYALTY | USWE SPORTS vs. EIDESVIK OFFSHORE NK | USWE SPORTS vs. PennantPark Investment | USWE SPORTS vs. XLMedia PLC |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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