Correlation Between Eidesvik Offshore and Proximar Seafood
Can any of the company-specific risk be diversified away by investing in both Eidesvik Offshore and Proximar Seafood 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 Proximar Seafood 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 Proximar Seafood AS, you can compare the effects of market volatilities on Eidesvik Offshore and Proximar Seafood 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 Proximar Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eidesvik Offshore and Proximar Seafood.
Diversification Opportunities for Eidesvik Offshore and Proximar Seafood
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eidesvik and Proximar is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Eidesvik Offshore ASA and Proximar Seafood AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proximar Seafood 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 Proximar Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proximar Seafood has no effect on the direction of Eidesvik Offshore i.e., Eidesvik Offshore and Proximar Seafood go up and down completely randomly.
Pair Corralation between Eidesvik Offshore and Proximar Seafood
Assuming the 90 days trading horizon Eidesvik Offshore ASA is expected to under-perform the Proximar Seafood. But the stock apears to be less risky and, when comparing its historical volatility, Eidesvik Offshore ASA is 1.99 times less risky than Proximar Seafood. The stock trades about -0.04 of its potential returns per unit of risk. The Proximar Seafood AS is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 361.00 in Proximar Seafood AS on September 5, 2024 and sell it today you would earn a total of 2.00 from holding Proximar Seafood AS or generate 0.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eidesvik Offshore ASA vs. Proximar Seafood AS
Performance |
| Timeline |
| Eidesvik Offshore ASA |
| Proximar Seafood |
Eidesvik Offshore and Proximar Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eidesvik Offshore and Proximar Seafood
The main advantage of trading using opposite Eidesvik Offshore and Proximar Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eidesvik Offshore position performs unexpectedly, Proximar Seafood 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 Proximar Seafood will offset losses from the drop in Proximar Seafood's long position.| Eidesvik Offshore vs. BW Energy | Eidesvik Offshore vs. Subsea 7 SA | Eidesvik Offshore vs. BW LPG | Eidesvik Offshore vs. Dno ASA |
| Proximar Seafood vs. Odfjell Technology | Proximar Seafood vs. Eidesvik Offshore ASA | Proximar Seafood vs. Nordic Mining ASA |
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.
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