Correlation Between YOMA STRATEGIC and Solstad Offshore
Can any of the company-specific risk be diversified away by investing in both YOMA STRATEGIC 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 YOMA STRATEGIC and Solstad Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YOMA STRATEGIC HLDG and Solstad Offshore ASA, you can compare the effects of market volatilities on YOMA STRATEGIC 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 YOMA STRATEGIC with a short position of Solstad Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of YOMA STRATEGIC and Solstad Offshore.
Diversification Opportunities for YOMA STRATEGIC and Solstad Offshore
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between YOMA and Solstad is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding YOMA STRATEGIC HLDG 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 YOMA STRATEGIC 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 YOMA STRATEGIC HLDG 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 YOMA STRATEGIC i.e., YOMA STRATEGIC and Solstad Offshore go up and down completely randomly.
Pair Corralation between YOMA STRATEGIC and Solstad Offshore
Assuming the 90 days trading horizon YOMA STRATEGIC HLDG is expected to under-perform the Solstad Offshore. In addition to that, YOMA STRATEGIC is 1.32 times more volatile than Solstad Offshore ASA. It trades about -0.06 of its total potential returns per unit of risk. Solstad Offshore ASA is currently generating about 0.0 per unit of volatility. If you would invest 352.00 in Solstad Offshore ASA on October 20, 2024 and sell it today you would lose (18.00) from holding Solstad Offshore ASA or give up 5.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
YOMA STRATEGIC HLDG vs. Solstad Offshore ASA
Performance |
| Timeline |
| YOMA STRATEGIC HLDG |
| Solstad Offshore ASA |
YOMA STRATEGIC and Solstad Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YOMA STRATEGIC and Solstad Offshore
The main advantage of trading using opposite YOMA STRATEGIC and Solstad Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YOMA STRATEGIC 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.| YOMA STRATEGIC vs. DXC Technology Co | YOMA STRATEGIC vs. ELMOS SEMICONDUCTOR | YOMA STRATEGIC vs. TOREX SEMICONDUCTOR LTD | YOMA STRATEGIC vs. BE Semiconductor Industries |
| Solstad Offshore vs. FRACTAL GAMING GROUP | Solstad Offshore vs. TRADEDOUBLER AB SK | Solstad Offshore vs. International Game Technology | Solstad Offshore vs. CarsalesCom |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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