Correlation Between Telenor ASA and Sea1 Offshore
Can any of the company-specific risk be diversified away by investing in both Telenor ASA and Sea1 Offshore 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 Telenor ASA and Sea1 Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telenor ASA and Sea1 Offshore, you can compare the effects of market volatilities on Telenor ASA and Sea1 Offshore 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 Telenor ASA with a short position of Sea1 Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telenor ASA and Sea1 Offshore.
Diversification Opportunities for Telenor ASA and Sea1 Offshore
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Telenor and Sea1 is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Telenor ASA and Sea1 Offshore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sea1 Offshore and Telenor 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 Telenor ASA are associated (or correlated) with Sea1 Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sea1 Offshore has no effect on the direction of Telenor ASA i.e., Telenor ASA and Sea1 Offshore go up and down completely randomly.
Pair Corralation between Telenor ASA and Sea1 Offshore
Assuming the 90 days trading horizon Telenor ASA is expected to generate 2.16 times less return on investment than Sea1 Offshore. But when comparing it to its historical volatility, Telenor ASA is 2.59 times less risky than Sea1 Offshore. It trades about 0.09 of its potential returns per unit of risk. Sea1 Offshore is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,023 in Sea1 Offshore on August 25, 2024 and sell it today you would earn a total of 952.00 from holding Sea1 Offshore or generate 47.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telenor ASA vs. Sea1 Offshore
Performance |
| Timeline |
| Telenor ASA |
| Sea1 Offshore |
Telenor ASA and Sea1 Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telenor ASA and Sea1 Offshore
The main advantage of trading using opposite Telenor ASA and Sea1 Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telenor ASA position performs unexpectedly, Sea1 Offshore 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 Sea1 Offshore will offset losses from the drop in Sea1 Offshore's long position.| Telenor ASA vs. Orkla ASA | Telenor ASA vs. DnB ASA | Telenor ASA vs. Yara International ASA | Telenor ASA vs. Storebrand ASA |
| Sea1 Offshore vs. Equinor ASA | Sea1 Offshore vs. DnB ASA | Sea1 Offshore vs. Aker BP ASA | Sea1 Offshore vs. Telenor 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |