Correlation Between SIEM OFFSHORE and BRIT AMER
Can any of the company-specific risk be diversified away by investing in both SIEM OFFSHORE and BRIT AMER 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 SIEM OFFSHORE and BRIT AMER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIEM OFFSHORE NEW and BRIT AMER TOBACCO, you can compare the effects of market volatilities on SIEM OFFSHORE and BRIT AMER 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 SIEM OFFSHORE with a short position of BRIT AMER. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIEM OFFSHORE and BRIT AMER.
Diversification Opportunities for SIEM OFFSHORE and BRIT AMER
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SIEM and BRIT is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding SIEM OFFSHORE NEW and BRIT AMER TOBACCO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRIT AMER TOBACCO and SIEM OFFSHORE 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 SIEM OFFSHORE NEW are associated (or correlated) with BRIT AMER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRIT AMER TOBACCO has no effect on the direction of SIEM OFFSHORE i.e., SIEM OFFSHORE and BRIT AMER go up and down completely randomly.
Pair Corralation between SIEM OFFSHORE and BRIT AMER
Assuming the 90 days trading horizon SIEM OFFSHORE NEW is expected to generate 2.99 times more return on investment than BRIT AMER. However, SIEM OFFSHORE is 2.99 times more volatile than BRIT AMER TOBACCO. It trades about 0.03 of its potential returns per unit of risk. BRIT AMER TOBACCO is currently generating about 0.05 per unit of risk. If you would invest 151.00 in SIEM OFFSHORE NEW on November 8, 2024 and sell it today you would earn a total of 36.00 from holding SIEM OFFSHORE NEW or generate 23.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIEM OFFSHORE NEW vs. BRIT AMER TOBACCO
Performance |
| Timeline |
| SIEM OFFSHORE NEW |
| BRIT AMER TOBACCO |
SIEM OFFSHORE and BRIT AMER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIEM OFFSHORE and BRIT AMER
The main advantage of trading using opposite SIEM OFFSHORE and BRIT AMER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIEM OFFSHORE position performs unexpectedly, BRIT AMER 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 BRIT AMER will offset losses from the drop in BRIT AMER's long position.| SIEM OFFSHORE vs. Align Technology | SIEM OFFSHORE vs. UMC Electronics Co | SIEM OFFSHORE vs. Nanjing Panda Electronics | SIEM OFFSHORE vs. Arrow Electronics |
| BRIT AMER vs. FAST RETAIL ADR | BRIT AMER vs. Sterling Construction | BRIT AMER vs. Chesapeake Utilities | BRIT AMER vs. United Utilities Group |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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