Correlation Between SIEM OFFSHORE and THORNEY TECHS
Can any of the company-specific risk be diversified away by investing in both SIEM OFFSHORE and THORNEY TECHS 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 THORNEY TECHS 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 THORNEY TECHS LTD, you can compare the effects of market volatilities on SIEM OFFSHORE and THORNEY TECHS 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 THORNEY TECHS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIEM OFFSHORE and THORNEY TECHS.
Diversification Opportunities for SIEM OFFSHORE and THORNEY TECHS
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SIEM and THORNEY is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding SIEM OFFSHORE NEW and THORNEY TECHS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on THORNEY TECHS LTD 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 THORNEY TECHS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of THORNEY TECHS LTD has no effect on the direction of SIEM OFFSHORE i.e., SIEM OFFSHORE and THORNEY TECHS go up and down completely randomly.
Pair Corralation between SIEM OFFSHORE and THORNEY TECHS
Assuming the 90 days trading horizon SIEM OFFSHORE NEW is expected to under-perform the THORNEY TECHS. But the stock apears to be less risky and, when comparing its historical volatility, SIEM OFFSHORE NEW is 1.75 times less risky than THORNEY TECHS. The stock trades about -0.03 of its potential returns per unit of risk. The THORNEY TECHS LTD is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 7.70 in THORNEY TECHS LTD on September 3, 2024 and sell it today you would earn a total of 0.05 from holding THORNEY TECHS LTD or generate 0.65% 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. THORNEY TECHS LTD
Performance |
| Timeline |
| SIEM OFFSHORE NEW |
| THORNEY TECHS LTD |
SIEM OFFSHORE and THORNEY TECHS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIEM OFFSHORE and THORNEY TECHS
The main advantage of trading using opposite SIEM OFFSHORE and THORNEY TECHS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIEM OFFSHORE position performs unexpectedly, THORNEY TECHS 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 THORNEY TECHS will offset losses from the drop in THORNEY TECHS's long position.| SIEM OFFSHORE vs. Corsair Gaming | SIEM OFFSHORE vs. Air New Zealand | SIEM OFFSHORE vs. SYSTEMAIR AB | SIEM OFFSHORE vs. ALTAIR RES INC |
| THORNEY TECHS vs. Apple Inc | THORNEY TECHS vs. Apple Inc | THORNEY TECHS vs. Apple Inc | THORNEY TECHS vs. Apple Inc |
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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