Correlation Between GungHo Online and Solstad Offshore
Can any of the company-specific risk be diversified away by investing in both GungHo Online and Solstad 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 GungHo Online and Solstad Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GungHo Online Entertainment and Solstad Offshore ASA, you can compare the effects of market volatilities on GungHo Online and Solstad 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 GungHo Online with a short position of Solstad Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and Solstad Offshore.
Diversification Opportunities for GungHo Online and Solstad Offshore
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between GungHo and Solstad is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and Solstad Offshore ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solstad Offshore ASA and GungHo Online 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 GungHo Online Entertainment are associated (or correlated) with Solstad Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solstad Offshore ASA has no effect on the direction of GungHo Online i.e., GungHo Online and Solstad Offshore go up and down completely randomly.
Pair Corralation between GungHo Online and Solstad Offshore
Assuming the 90 days horizon GungHo Online is expected to generate 4.03 times less return on investment than Solstad Offshore. But when comparing it to its historical volatility, GungHo Online Entertainment is 1.53 times less risky than Solstad Offshore. It trades about 0.04 of its potential returns per unit of risk. Solstad Offshore ASA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 271.00 in Solstad Offshore ASA on October 14, 2024 and sell it today you would earn a total of 63.00 from holding Solstad Offshore ASA or generate 23.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GungHo Online Entertainment vs. Solstad Offshore ASA
Performance |
| Timeline |
| GungHo Online Entert |
| Solstad Offshore ASA |
GungHo Online and Solstad Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GungHo Online and Solstad Offshore
The main advantage of trading using opposite GungHo Online and Solstad Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, Solstad 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 Solstad Offshore will offset losses from the drop in Solstad Offshore's long position.| GungHo Online vs. SOFI TECHNOLOGIES | GungHo Online vs. CENTURIA OFFICE REIT | GungHo Online vs. PKSHA TECHNOLOGY INC | GungHo Online vs. ACCSYS TECHPLC EO |
| Solstad Offshore vs. URBAN OUTFITTERS | Solstad Offshore vs. GungHo Online Entertainment | Solstad Offshore vs. BORR DRILLING NEW | Solstad Offshore vs. Eidesvik Offshore 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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