Correlation Between Havila Shipping and Eidesvik Offshore
Can any of the company-specific risk be diversified away by investing in both Havila Shipping and Eidesvik 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 Havila Shipping and Eidesvik Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Havila Shipping ASA and Eidesvik Offshore ASA, you can compare the effects of market volatilities on Havila Shipping and Eidesvik 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 Havila Shipping with a short position of Eidesvik Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Havila Shipping and Eidesvik Offshore.
Diversification Opportunities for Havila Shipping and Eidesvik Offshore
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Havila and Eidesvik is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Havila Shipping ASA and Eidesvik Offshore ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eidesvik Offshore ASA and Havila Shipping 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 Havila Shipping ASA are associated (or correlated) with Eidesvik Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eidesvik Offshore ASA has no effect on the direction of Havila Shipping i.e., Havila Shipping and Eidesvik Offshore go up and down completely randomly.
Pair Corralation between Havila Shipping and Eidesvik Offshore
Assuming the 90 days trading horizon Havila Shipping ASA is expected to under-perform the Eidesvik Offshore. In addition to that, Havila Shipping is 2.16 times more volatile than Eidesvik Offshore ASA. It trades about -0.1 of its total potential returns per unit of risk. Eidesvik Offshore ASA is currently generating about -0.11 per unit of volatility. If you would invest 1,396 in Eidesvik Offshore ASA on November 7, 2024 and sell it today you would lose (66.00) from holding Eidesvik Offshore ASA or give up 4.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Havila Shipping ASA vs. Eidesvik Offshore ASA
Performance |
| Timeline |
| Havila Shipping ASA |
| Eidesvik Offshore ASA |
Havila Shipping and Eidesvik Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Havila Shipping and Eidesvik Offshore
The main advantage of trading using opposite Havila Shipping and Eidesvik Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Havila Shipping position performs unexpectedly, Eidesvik 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 Eidesvik Offshore will offset losses from the drop in Eidesvik Offshore's long position.| Havila Shipping vs. Solstad Offsho | Havila Shipping vs. Eidesvik Offshore ASA | Havila Shipping vs. Prosafe SE | Havila Shipping vs. BW Offshore |
| Eidesvik Offshore vs. Solstad Offsho | Eidesvik Offshore vs. Havila Shipping ASA | Eidesvik Offshore vs. Prosafe SE | Eidesvik Offshore vs. BW Offshore |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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