Correlation Between Sea Oil and XSpring Capital
Can any of the company-specific risk be diversified away by investing in both Sea Oil and XSpring Capital 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 Sea Oil and XSpring Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sea Oil Public and XSpring Capital Public, you can compare the effects of market volatilities on Sea Oil and XSpring Capital 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 Sea Oil with a short position of XSpring Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sea Oil and XSpring Capital.
Diversification Opportunities for Sea Oil and XSpring Capital
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sea and XSpring is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Sea Oil Public and XSpring Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XSpring Capital Public and Sea Oil 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 Sea Oil Public are associated (or correlated) with XSpring Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XSpring Capital Public has no effect on the direction of Sea Oil i.e., Sea Oil and XSpring Capital go up and down completely randomly.
Pair Corralation between Sea Oil and XSpring Capital
Assuming the 90 days trading horizon Sea Oil Public is expected to generate 0.56 times more return on investment than XSpring Capital. However, Sea Oil Public is 1.8 times less risky than XSpring Capital. It trades about 0.03 of its potential returns per unit of risk. XSpring Capital Public is currently generating about -0.05 per unit of risk. If you would invest 254.00 in Sea Oil Public on September 1, 2024 and sell it today you would earn a total of 2.00 from holding Sea Oil Public or generate 0.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sea Oil Public vs. XSpring Capital Public
Performance |
| Timeline |
| Sea Oil Public |
| XSpring Capital Public |
Sea Oil and XSpring Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sea Oil and XSpring Capital
The main advantage of trading using opposite Sea Oil and XSpring Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sea Oil position performs unexpectedly, XSpring Capital 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 XSpring Capital will offset losses from the drop in XSpring Capital's long position.| Sea Oil vs. Star Petroleum Refining | Sea Oil vs. Power Solution Technologies | Sea Oil vs. Kingsmen CMTI Public | Sea Oil vs. Project Planning Service |
| XSpring Capital vs. TMBThanachart Bank Public | XSpring Capital vs. Ngern Tid Lor | XSpring Capital vs. Jay Mart Public | XSpring Capital vs. Sri Trang Gloves |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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