Correlation Between CHINA OIL and SIEM OFFSHORE
Can any of the company-specific risk be diversified away by investing in both CHINA OIL and SIEM 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 CHINA OIL and SIEM OFFSHORE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHINA OIL AND and SIEM OFFSHORE NEW, you can compare the effects of market volatilities on CHINA OIL and SIEM 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 CHINA OIL with a short position of SIEM OFFSHORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA OIL and SIEM OFFSHORE.
Diversification Opportunities for CHINA OIL and SIEM OFFSHORE
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CHINA and SIEM is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding CHINA OIL AND and SIEM OFFSHORE NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIEM OFFSHORE NEW and CHINA OIL 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 CHINA OIL AND are associated (or correlated) with SIEM OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIEM OFFSHORE NEW has no effect on the direction of CHINA OIL i.e., CHINA OIL and SIEM OFFSHORE go up and down completely randomly.
Pair Corralation between CHINA OIL and SIEM OFFSHORE
Assuming the 90 days trading horizon CHINA OIL AND is expected to generate 0.12 times more return on investment than SIEM OFFSHORE. However, CHINA OIL AND is 8.67 times less risky than SIEM OFFSHORE. It trades about 0.08 of its potential returns per unit of risk. SIEM OFFSHORE NEW is currently generating about -0.03 per unit of risk. If you would invest 2.20 in CHINA OIL AND on September 3, 2024 and sell it today you would earn a total of 0.10 from holding CHINA OIL AND or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CHINA OIL AND vs. SIEM OFFSHORE NEW
Performance |
| Timeline |
| CHINA OIL AND |
| SIEM OFFSHORE NEW |
CHINA OIL and SIEM OFFSHORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHINA OIL and SIEM OFFSHORE
The main advantage of trading using opposite CHINA OIL and SIEM OFFSHORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHINA OIL position performs unexpectedly, SIEM 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 SIEM OFFSHORE will offset losses from the drop in SIEM OFFSHORE's long position.| CHINA OIL vs. INSURANCE AUST GRP | CHINA OIL vs. SCANSOURCE | CHINA OIL vs. Japan Post Insurance | CHINA OIL vs. QBE Insurance Group |
| SIEM OFFSHORE vs. Corsair Gaming | SIEM OFFSHORE vs. Air New Zealand | SIEM OFFSHORE vs. SYSTEMAIR AB | SIEM OFFSHORE vs. ALTAIR RES INC |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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