Correlation Between EIDESVIK OFFSHORE and Lloyds Banking
Can any of the company-specific risk be diversified away by investing in both EIDESVIK OFFSHORE and Lloyds Banking 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 Lloyds Banking 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 Lloyds Banking Group, you can compare the effects of market volatilities on EIDESVIK OFFSHORE and Lloyds Banking 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 Lloyds Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIDESVIK OFFSHORE and Lloyds Banking.
Diversification Opportunities for EIDESVIK OFFSHORE and Lloyds Banking
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between EIDESVIK and Lloyds is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding EIDESVIK OFFSHORE NK and Lloyds Banking Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lloyds Banking Group 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 Lloyds Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lloyds Banking Group has no effect on the direction of EIDESVIK OFFSHORE i.e., EIDESVIK OFFSHORE and Lloyds Banking go up and down completely randomly.
Pair Corralation between EIDESVIK OFFSHORE and Lloyds Banking
Assuming the 90 days horizon EIDESVIK OFFSHORE NK is expected to under-perform the Lloyds Banking. But the stock apears to be less risky and, when comparing its historical volatility, EIDESVIK OFFSHORE NK is 1.33 times less risky than Lloyds Banking. The stock trades about -0.06 of its potential returns per unit of risk. The Lloyds Banking Group is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 272.00 in Lloyds Banking Group on August 28, 2024 and sell it today you would lose (18.00) from holding Lloyds Banking Group or give up 6.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EIDESVIK OFFSHORE NK vs. Lloyds Banking Group
Performance |
| Timeline |
| EIDESVIK OFFSHORE |
| Lloyds Banking Group |
EIDESVIK OFFSHORE and Lloyds Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIDESVIK OFFSHORE and Lloyds Banking
The main advantage of trading using opposite EIDESVIK OFFSHORE and Lloyds Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIDESVIK OFFSHORE position performs unexpectedly, Lloyds Banking 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 Lloyds Banking will offset losses from the drop in Lloyds Banking's long position.| EIDESVIK OFFSHORE vs. MOVIE GAMES SA | EIDESVIK OFFSHORE vs. Townsquare Media | EIDESVIK OFFSHORE vs. Flutter Entertainment PLC | EIDESVIK OFFSHORE vs. RCS MediaGroup SpA |
| Lloyds Banking vs. SYSTEMAIR AB | Lloyds Banking vs. COLUMBIA SPORTSWEAR | Lloyds Banking vs. EIDESVIK OFFSHORE NK | Lloyds Banking vs. ANTA SPORTS PRODUCT |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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