Correlation Between Eidesvik Offshore and United States
Can any of the company-specific risk be diversified away by investing in both Eidesvik Offshore and United States 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 United States 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 United States Steel, you can compare the effects of market volatilities on Eidesvik Offshore and United States 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 United States. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eidesvik Offshore and United States.
Diversification Opportunities for Eidesvik Offshore and United States
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eidesvik and United is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Eidesvik Offshore ASA and United States Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United States Steel 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 United States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United States Steel has no effect on the direction of Eidesvik Offshore i.e., Eidesvik Offshore and United States go up and down completely randomly.
Pair Corralation between Eidesvik Offshore and United States
Assuming the 90 days trading horizon Eidesvik Offshore ASA is expected to under-perform the United States. But the stock apears to be less risky and, when comparing its historical volatility, Eidesvik Offshore ASA is 1.76 times less risky than United States. The stock trades about -0.15 of its potential returns per unit of risk. The United States Steel is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3,618 in United States Steel on August 31, 2024 and sell it today you would earn a total of 184.00 from holding United States Steel or generate 5.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eidesvik Offshore ASA vs. United States Steel
Performance |
| Timeline |
| Eidesvik Offshore ASA |
| United States Steel |
Eidesvik Offshore and United States Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eidesvik Offshore and United States
The main advantage of trading using opposite Eidesvik Offshore and United States positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eidesvik Offshore position performs unexpectedly, United States 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 United States will offset losses from the drop in United States' long position.| Eidesvik Offshore vs. Playtech plc | Eidesvik Offshore vs. UET United Electronic | Eidesvik Offshore vs. GigaMedia | Eidesvik Offshore vs. Beijing Media |
| United States vs. Canadian Utilities Limited | United States vs. Digilife Technologies Limited | United States vs. Eidesvik Offshore ASA | United States vs. BW OFFSHORE LTD |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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