Correlation Between TGS ASA and Schlumberger
Can any of the company-specific risk be diversified away by investing in both TGS ASA and Schlumberger 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 TGS ASA and Schlumberger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TGS ASA and Schlumberger NV, you can compare the effects of market volatilities on TGS ASA and Schlumberger 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 TGS ASA with a short position of Schlumberger. Check out your portfolio center. Please also check ongoing floating volatility patterns of TGS ASA and Schlumberger.
Diversification Opportunities for TGS ASA and Schlumberger
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TGS and Schlumberger is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding TGS ASA and Schlumberger NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schlumberger NV and TGS 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 TGS ASA are associated (or correlated) with Schlumberger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schlumberger NV has no effect on the direction of TGS ASA i.e., TGS ASA and Schlumberger go up and down completely randomly.
Pair Corralation between TGS ASA and Schlumberger
Assuming the 90 days horizon TGS ASA is expected to under-perform the Schlumberger. In addition to that, TGS ASA is 1.76 times more volatile than Schlumberger NV. It trades about -0.03 of its total potential returns per unit of risk. Schlumberger NV is currently generating about -0.04 per unit of volatility. If you would invest 5,535 in Schlumberger NV on September 12, 2024 and sell it today you would lose (1,448) from holding Schlumberger NV or give up 26.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 59.94% |
| Values | Daily Returns |
TGS ASA vs. Schlumberger NV
Performance |
| Timeline |
| TGS ASA |
| Schlumberger NV |
TGS ASA and Schlumberger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TGS ASA and Schlumberger
The main advantage of trading using opposite TGS ASA and Schlumberger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TGS ASA position performs unexpectedly, Schlumberger 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 Schlumberger will offset losses from the drop in Schlumberger's long position.| TGS ASA vs. Oceaneering International | TGS ASA vs. Nine Energy Service | TGS ASA vs. Schlumberger NV | TGS ASA vs. Calfrac Well Services |
| Schlumberger vs. Baker Hughes Co | Schlumberger vs. NOV Inc | Schlumberger vs. Weatherford International PLC | Schlumberger vs. Tenaris SA ADR |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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