Correlation Between Saga Pure and Solstad Offsho
Can any of the company-specific risk be diversified away by investing in both Saga Pure and Solstad Offsho 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 Saga Pure and Solstad Offsho into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saga Pure ASA and Solstad Offsho, you can compare the effects of market volatilities on Saga Pure and Solstad Offsho 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 Saga Pure with a short position of Solstad Offsho. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saga Pure and Solstad Offsho.
Diversification Opportunities for Saga Pure and Solstad Offsho
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Saga and Solstad is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Saga Pure ASA and Solstad Offsho in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solstad Offsho and Saga Pure 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 Saga Pure ASA are associated (or correlated) with Solstad Offsho. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solstad Offsho has no effect on the direction of Saga Pure i.e., Saga Pure and Solstad Offsho go up and down completely randomly.
Pair Corralation between Saga Pure and Solstad Offsho
Assuming the 90 days trading horizon Saga Pure ASA is expected to generate 0.29 times more return on investment than Solstad Offsho. However, Saga Pure ASA is 3.47 times less risky than Solstad Offsho. It trades about 0.0 of its potential returns per unit of risk. Solstad Offsho is currently generating about 0.0 per unit of risk. If you would invest 127.00 in Saga Pure ASA on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Saga Pure ASA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saga Pure ASA vs. Solstad Offsho
Performance |
| Timeline |
| Saga Pure ASA |
| Solstad Offsho |
Saga Pure and Solstad Offsho Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saga Pure and Solstad Offsho
The main advantage of trading using opposite Saga Pure and Solstad Offsho positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saga Pure position performs unexpectedly, Solstad Offsho 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 Offsho will offset losses from the drop in Solstad Offsho's long position.| Saga Pure vs. Aker Horizons AS | Saga Pure vs. REC Silicon ASA | Saga Pure vs. Kongsberg Automotive Holding | Saga Pure vs. Aker Carbon Capture |
| Solstad Offsho vs. Havila Shipping ASA | Solstad Offsho vs. Prosafe SE | Solstad Offsho vs. Eidesvik Offshore ASA |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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