Correlation Between Eidesvik Offshore and AXA SA
Can any of the company-specific risk be diversified away by investing in both Eidesvik Offshore and AXA SA 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 AXA SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eidesvik Offshore ASA and AXA SA, you can compare the effects of market volatilities on Eidesvik Offshore and AXA SA 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 AXA SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eidesvik Offshore and AXA SA.
Diversification Opportunities for Eidesvik Offshore and AXA SA
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eidesvik and AXA is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Eidesvik Offshore ASA and AXA SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXA SA 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 ASA are associated (or correlated) with AXA SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXA SA has no effect on the direction of Eidesvik Offshore i.e., Eidesvik Offshore and AXA SA go up and down completely randomly.
Pair Corralation between Eidesvik Offshore and AXA SA
Assuming the 90 days trading horizon Eidesvik Offshore ASA is expected to generate 2.46 times more return on investment than AXA SA. However, Eidesvik Offshore is 2.46 times more volatile than AXA SA. It trades about 0.05 of its potential returns per unit of risk. AXA SA is currently generating about 0.06 per unit of risk. If you would invest 66.00 in Eidesvik Offshore ASA on September 4, 2024 and sell it today you would earn a total of 43.00 from holding Eidesvik Offshore ASA or generate 65.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Eidesvik Offshore ASA vs. AXA SA
Performance |
| Timeline |
| Eidesvik Offshore ASA |
| AXA SA |
Eidesvik Offshore and AXA SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eidesvik Offshore and AXA SA
The main advantage of trading using opposite Eidesvik Offshore and AXA SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eidesvik Offshore position performs unexpectedly, AXA SA 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 AXA SA will offset losses from the drop in AXA SA's long position.| Eidesvik Offshore vs. Halliburton | Eidesvik Offshore vs. Superior Plus Corp | Eidesvik Offshore vs. NMI Holdings | Eidesvik Offshore vs. Origin Agritech |
| AXA SA vs. Ribbon Communications | AXA SA vs. INDOFOOD AGRI RES | AXA SA vs. Food Life Companies | AXA SA vs. Tyson Foods |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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