Correlation Between EIDESVIK OFFSHORE and Walmart
Can any of the company-specific risk be diversified away by investing in both EIDESVIK OFFSHORE and Walmart 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 Walmart 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 Walmart, you can compare the effects of market volatilities on EIDESVIK OFFSHORE and Walmart 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 Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of EIDESVIK OFFSHORE and Walmart.
Diversification Opportunities for EIDESVIK OFFSHORE and Walmart
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EIDESVIK and Walmart is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding EIDESVIK OFFSHORE NK and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart 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 Walmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walmart has no effect on the direction of EIDESVIK OFFSHORE i.e., EIDESVIK OFFSHORE and Walmart go up and down completely randomly.
Pair Corralation between EIDESVIK OFFSHORE and Walmart
Assuming the 90 days horizon EIDESVIK OFFSHORE NK is expected to under-perform the Walmart. But the stock apears to be less risky and, when comparing its historical volatility, EIDESVIK OFFSHORE NK is 1.11 times less risky than Walmart. The stock trades about -0.06 of its potential returns per unit of risk. The Walmart is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 8,029 in Walmart on September 13, 2024 and sell it today you would earn a total of 971.00 from holding Walmart or generate 12.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EIDESVIK OFFSHORE NK vs. Walmart
Performance |
| Timeline |
| EIDESVIK OFFSHORE |
| Walmart |
EIDESVIK OFFSHORE and Walmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EIDESVIK OFFSHORE and Walmart
The main advantage of trading using opposite EIDESVIK OFFSHORE and Walmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EIDESVIK OFFSHORE position performs unexpectedly, Walmart 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 Walmart will offset losses from the drop in Walmart's long position.| EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc | EIDESVIK OFFSHORE vs. Apple Inc |
| Walmart vs. Nippon Steel | Walmart vs. Insteel Industries | Walmart vs. EIDESVIK OFFSHORE NK | Walmart vs. SIEM OFFSHORE NEW |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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