Correlation Between Eidesvik Offshore and BW OFFSHORE
Can any of the company-specific risk be diversified away by investing in both Eidesvik Offshore and BW OFFSHORE 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 BW OFFSHORE 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 BW OFFSHORE LTD, you can compare the effects of market volatilities on Eidesvik Offshore and BW OFFSHORE 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 BW OFFSHORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eidesvik Offshore and BW OFFSHORE.
Diversification Opportunities for Eidesvik Offshore and BW OFFSHORE
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eidesvik and XY81 is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Eidesvik Offshore ASA and BW OFFSHORE LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BW OFFSHORE LTD 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 BW OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BW OFFSHORE LTD has no effect on the direction of Eidesvik Offshore i.e., Eidesvik Offshore and BW OFFSHORE go up and down completely randomly.
Pair Corralation between Eidesvik Offshore and BW OFFSHORE
Assuming the 90 days trading horizon Eidesvik Offshore is expected to generate 1.92 times less return on investment than BW OFFSHORE. In addition to that, Eidesvik Offshore is 1.18 times more volatile than BW OFFSHORE LTD. It trades about 0.04 of its total potential returns per unit of risk. BW OFFSHORE LTD is currently generating about 0.08 per unit of volatility. If you would invest 158.00 in BW OFFSHORE LTD on September 2, 2024 and sell it today you would earn a total of 80.00 from holding BW OFFSHORE LTD or generate 50.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eidesvik Offshore ASA vs. BW OFFSHORE LTD
Performance |
| Timeline |
| Eidesvik Offshore ASA |
| BW OFFSHORE LTD |
Eidesvik Offshore and BW OFFSHORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eidesvik Offshore and BW OFFSHORE
The main advantage of trading using opposite Eidesvik Offshore and BW OFFSHORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eidesvik Offshore position performs unexpectedly, BW OFFSHORE 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 BW OFFSHORE will offset losses from the drop in BW OFFSHORE'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 |
| BW OFFSHORE vs. Superior Plus Corp | BW OFFSHORE vs. NMI Holdings | BW OFFSHORE vs. Origin Agritech | BW OFFSHORE vs. SIVERS SEMICONDUCTORS AB |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |