Correlation Between EIDESVIK OFFSHORE and Elmos Semiconductor
Can any of the company-specific risk be diversified away by investing in both EIDESVIK OFFSHORE and Elmos Semiconductor 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 Elmos Semiconductor 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 Elmos Semiconductor SE, you can compare the effects of market volatilities on EIDESVIK OFFSHORE and Elmos Semiconductor 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 Elmos Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIDESVIK OFFSHORE and Elmos Semiconductor.
Diversification Opportunities for EIDESVIK OFFSHORE and Elmos Semiconductor
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between EIDESVIK and Elmos is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding EIDESVIK OFFSHORE NK and Elmos Semiconductor SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elmos Semiconductor 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 Elmos Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elmos Semiconductor has no effect on the direction of EIDESVIK OFFSHORE i.e., EIDESVIK OFFSHORE and Elmos Semiconductor go up and down completely randomly.
Pair Corralation between EIDESVIK OFFSHORE and Elmos Semiconductor
Assuming the 90 days horizon EIDESVIK OFFSHORE NK is expected to generate 1.04 times more return on investment than Elmos Semiconductor. However, EIDESVIK OFFSHORE is 1.04 times more volatile than Elmos Semiconductor SE. It trades about 0.03 of its potential returns per unit of risk. Elmos Semiconductor SE is currently generating about 0.0 per unit of risk. If you would invest 98.00 in EIDESVIK OFFSHORE NK on September 12, 2024 and sell it today you would earn a total of 12.00 from holding EIDESVIK OFFSHORE NK or generate 12.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EIDESVIK OFFSHORE NK vs. Elmos Semiconductor SE
Performance |
| Timeline |
| EIDESVIK OFFSHORE |
| Elmos Semiconductor |
EIDESVIK OFFSHORE and Elmos Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIDESVIK OFFSHORE and Elmos Semiconductor
The main advantage of trading using opposite EIDESVIK OFFSHORE and Elmos Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIDESVIK OFFSHORE position performs unexpectedly, Elmos Semiconductor 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 Elmos Semiconductor will offset losses from the drop in Elmos Semiconductor's long position.| EIDESVIK OFFSHORE vs. TAL Education Group | EIDESVIK OFFSHORE vs. PLAYTIKA HOLDING DL 01 | EIDESVIK OFFSHORE vs. GigaMedia | EIDESVIK OFFSHORE vs. DeVry Education Group |
| Elmos Semiconductor vs. Taiwan Semiconductor Manufacturing | Elmos Semiconductor vs. Broadcom | Elmos Semiconductor vs. Superior Plus Corp | Elmos Semiconductor vs. SIVERS SEMICONDUCTORS AB |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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