Correlation Between Equinor ASA and Eneos Holdings
Can any of the company-specific risk be diversified away by investing in both Equinor ASA and Eneos Holdings 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 Equinor ASA and Eneos Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equinor ASA and Eneos Holdings ADR, you can compare the effects of market volatilities on Equinor ASA and Eneos Holdings 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 Equinor ASA with a short position of Eneos Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equinor ASA and Eneos Holdings.
Diversification Opportunities for Equinor ASA and Eneos Holdings
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Equinor and Eneos is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Equinor ASA and Eneos Holdings ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eneos Holdings ADR and Equinor ASA 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 Equinor ASA are associated (or correlated) with Eneos Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eneos Holdings ADR has no effect on the direction of Equinor ASA i.e., Equinor ASA and Eneos Holdings go up and down completely randomly.
Pair Corralation between Equinor ASA and Eneos Holdings
Assuming the 90 days horizon Equinor ASA is expected to generate 1.9 times less return on investment than Eneos Holdings. But when comparing it to its historical volatility, Equinor ASA is 1.36 times less risky than Eneos Holdings. It trades about 0.03 of its potential returns per unit of risk. Eneos Holdings ADR is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 782.00 in Eneos Holdings ADR on November 4, 2024 and sell it today you would earn a total of 163.00 from holding Eneos Holdings ADR or generate 20.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.33% |
| Values | Daily Returns |
Equinor ASA vs. Eneos Holdings ADR
Performance |
| Timeline |
| Equinor ASA |
| Eneos Holdings ADR |
Equinor ASA and Eneos Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equinor ASA and Eneos Holdings
The main advantage of trading using opposite Equinor ASA and Eneos Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equinor ASA position performs unexpectedly, Eneos Holdings 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 Eneos Holdings will offset losses from the drop in Eneos Holdings' long position.| Equinor ASA vs. China Petroleum Chemical | Equinor ASA vs. Galp Energa | Equinor ASA vs. Exxon Mobil Corp | Equinor ASA vs. Eni SpA |
| Eneos Holdings vs. Idemitsu Kosan CoLtd | Eneos Holdings vs. HF Sinclair Corp | Eneos Holdings vs. Idemitsu Kosan Co | Eneos Holdings vs. PBF Energy |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |