Correlation Between Eidesvik Offshore and Webster Financial
Can any of the company-specific risk be diversified away by investing in both Eidesvik Offshore and Webster Financial 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 Webster Financial 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 Webster Financial, you can compare the effects of market volatilities on Eidesvik Offshore and Webster Financial 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 Webster Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eidesvik Offshore and Webster Financial.
Diversification Opportunities for Eidesvik Offshore and Webster Financial
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eidesvik and Webster is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Eidesvik Offshore ASA and Webster Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Webster Financial 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 Webster Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Webster Financial has no effect on the direction of Eidesvik Offshore i.e., Eidesvik Offshore and Webster Financial go up and down completely randomly.
Pair Corralation between Eidesvik Offshore and Webster Financial
Assuming the 90 days trading horizon Eidesvik Offshore is expected to generate 1.29 times less return on investment than Webster Financial. In addition to that, Eidesvik Offshore is 1.19 times more volatile than Webster Financial. It trades about 0.05 of its total potential returns per unit of risk. Webster Financial is currently generating about 0.07 per unit of volatility. If you would invest 3,383 in Webster Financial on September 2, 2024 and sell it today you would earn a total of 2,417 from holding Webster Financial or generate 71.45% 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. Webster Financial
Performance |
| Timeline |
| Eidesvik Offshore ASA |
| Webster Financial |
Eidesvik Offshore and Webster Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eidesvik Offshore and Webster Financial
The main advantage of trading using opposite Eidesvik Offshore and Webster Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eidesvik Offshore position performs unexpectedly, Webster Financial 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 Webster Financial will offset losses from the drop in Webster Financial's long position.| Eidesvik Offshore vs. Marie Brizard Wine | Eidesvik Offshore vs. Transportadora de Gas | Eidesvik Offshore vs. Transport International Holdings | Eidesvik Offshore vs. BII Railway Transportation |
| Webster Financial vs. Playa Hotels Resorts | Webster Financial vs. FIREWEED METALS P | Webster Financial vs. Hyatt Hotels | Webster Financial vs. HYATT HOTELS A |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |