Correlation Between BW OFFSHORE and Sixt Leasing
Can any of the company-specific risk be diversified away by investing in both BW OFFSHORE and Sixt Leasing 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 BW OFFSHORE and Sixt Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BW OFFSHORE LTD and Sixt Leasing SE, you can compare the effects of market volatilities on BW OFFSHORE and Sixt Leasing 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 BW OFFSHORE with a short position of Sixt Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of BW OFFSHORE and Sixt Leasing.
Diversification Opportunities for BW OFFSHORE and Sixt Leasing
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between XY81 and Sixt is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding BW OFFSHORE LTD and Sixt Leasing SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sixt Leasing SE and BW OFFSHORE 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 BW OFFSHORE LTD are associated (or correlated) with Sixt Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sixt Leasing SE has no effect on the direction of BW OFFSHORE i.e., BW OFFSHORE and Sixt Leasing go up and down completely randomly.
Pair Corralation between BW OFFSHORE and Sixt Leasing
Assuming the 90 days trading horizon BW OFFSHORE LTD is expected to generate 1.79 times more return on investment than Sixt Leasing. However, BW OFFSHORE is 1.79 times more volatile than Sixt Leasing SE. It trades about 0.07 of its potential returns per unit of risk. Sixt Leasing SE is currently generating about -0.06 per unit of risk. If you would invest 209.00 in BW OFFSHORE LTD on September 12, 2024 and sell it today you would earn a total of 24.00 from holding BW OFFSHORE LTD or generate 11.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BW OFFSHORE LTD vs. Sixt Leasing SE
Performance |
| Timeline |
| BW OFFSHORE LTD |
| Sixt Leasing SE |
BW OFFSHORE and Sixt Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BW OFFSHORE and Sixt Leasing
The main advantage of trading using opposite BW OFFSHORE and Sixt Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BW OFFSHORE position performs unexpectedly, Sixt Leasing 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 Sixt Leasing will offset losses from the drop in Sixt Leasing's long position.| BW OFFSHORE vs. Tenaris SA | BW OFFSHORE vs. NOV Inc | BW OFFSHORE vs. Superior Plus Corp | BW OFFSHORE vs. SIVERS SEMICONDUCTORS AB |
| Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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