Correlation Between Eneos Holdings and Equinor ASA
Can any of the company-specific risk be diversified away by investing in both Eneos Holdings and Equinor ASA 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 Eneos Holdings and Equinor ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eneos Holdings ADR and Equinor ASA, you can compare the effects of market volatilities on Eneos Holdings and Equinor ASA 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 Eneos Holdings with a short position of Equinor ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eneos Holdings and Equinor ASA.
Diversification Opportunities for Eneos Holdings and Equinor ASA
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Eneos and Equinor is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Eneos Holdings ADR and Equinor ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equinor ASA and Eneos Holdings 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 Eneos Holdings ADR are associated (or correlated) with Equinor ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equinor ASA has no effect on the direction of Eneos Holdings i.e., Eneos Holdings and Equinor ASA go up and down completely randomly.
Pair Corralation between Eneos Holdings and Equinor ASA
Assuming the 90 days horizon Eneos Holdings ADR is expected to generate 3.86 times more return on investment than Equinor ASA. However, Eneos Holdings is 3.86 times more volatile than Equinor ASA. It trades about 0.07 of its potential returns per unit of risk. Equinor ASA is currently generating about 0.22 per unit of risk. If you would invest 1,043 in Eneos Holdings ADR on October 24, 2024 and sell it today you would earn a total of 49.00 from holding Eneos Holdings ADR or generate 4.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eneos Holdings ADR vs. Equinor ASA
Performance |
| Timeline |
| Eneos Holdings ADR |
| Equinor ASA |
Eneos Holdings and Equinor ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eneos Holdings and Equinor ASA
The main advantage of trading using opposite Eneos Holdings and Equinor ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eneos Holdings position performs unexpectedly, Equinor ASA 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 Equinor ASA will offset losses from the drop in Equinor ASA's long position.| Eneos Holdings vs. Idemitsu Kosan CoLtd | Eneos Holdings vs. HF Sinclair Corp | Eneos Holdings vs. Idemitsu Kosan Co | Eneos Holdings vs. PBF Energy |
| Equinor ASA vs. China Petroleum Chemical | Equinor ASA vs. Galp Energa | Equinor ASA vs. Exxon Mobil Corp | Equinor ASA vs. Eni SpA |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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