Correlation Between JABIL CIRCUIT and Eidesvik Offshore
Can any of the company-specific risk be diversified away by investing in both JABIL CIRCUIT 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 JABIL CIRCUIT and Eidesvik Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JABIL CIRCUIT and Eidesvik Offshore ASA, you can compare the effects of market volatilities on JABIL CIRCUIT 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 JABIL CIRCUIT with a short position of Eidesvik Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of JABIL CIRCUIT and Eidesvik Offshore.
Diversification Opportunities for JABIL CIRCUIT and Eidesvik Offshore
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JABIL and Eidesvik is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding JABIL CIRCUIT 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 JABIL CIRCUIT 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 JABIL CIRCUIT 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 JABIL CIRCUIT i.e., JABIL CIRCUIT and Eidesvik Offshore go up and down completely randomly.
Pair Corralation between JABIL CIRCUIT and Eidesvik Offshore
Assuming the 90 days trading horizon JABIL CIRCUIT is expected to generate 0.75 times more return on investment than Eidesvik Offshore. However, JABIL CIRCUIT is 1.33 times less risky than Eidesvik Offshore. It trades about 0.07 of its potential returns per unit of risk. Eidesvik Offshore ASA is currently generating about 0.05 per unit of risk. If you would invest 6,422 in JABIL CIRCUIT on September 14, 2024 and sell it today you would earn a total of 6,203 from holding JABIL CIRCUIT or generate 96.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
JABIL CIRCUIT vs. Eidesvik Offshore ASA
Performance |
| Timeline |
| JABIL CIRCUIT |
| Eidesvik Offshore ASA |
JABIL CIRCUIT and Eidesvik Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JABIL CIRCUIT and Eidesvik Offshore
The main advantage of trading using opposite JABIL CIRCUIT and Eidesvik Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JABIL CIRCUIT 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.| JABIL CIRCUIT vs. Apple Inc | JABIL CIRCUIT vs. Apple Inc | JABIL CIRCUIT vs. Apple Inc | JABIL CIRCUIT vs. Apple Inc |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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