Correlation Between Xiabuxiabu Catering and Solstad Offshore
Can any of the company-specific risk be diversified away by investing in both Xiabuxiabu Catering and Solstad 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 Xiabuxiabu Catering and Solstad Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xiabuxiabu Catering Management and Solstad Offshore ASA, you can compare the effects of market volatilities on Xiabuxiabu Catering and Solstad 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 Xiabuxiabu Catering with a short position of Solstad Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiabuxiabu Catering and Solstad Offshore.
Diversification Opportunities for Xiabuxiabu Catering and Solstad Offshore
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xiabuxiabu and Solstad is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Xiabuxiabu Catering Management and Solstad Offshore ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solstad Offshore ASA and Xiabuxiabu Catering 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 Xiabuxiabu Catering Management are associated (or correlated) with Solstad Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solstad Offshore ASA has no effect on the direction of Xiabuxiabu Catering i.e., Xiabuxiabu Catering and Solstad Offshore go up and down completely randomly.
Pair Corralation between Xiabuxiabu Catering and Solstad Offshore
Assuming the 90 days horizon Xiabuxiabu Catering is expected to generate 1.1 times less return on investment than Solstad Offshore. In addition to that, Xiabuxiabu Catering is 1.33 times more volatile than Solstad Offshore ASA. It trades about 0.14 of its total potential returns per unit of risk. Solstad Offshore ASA is currently generating about 0.21 per unit of volatility. If you would invest 319.00 in Solstad Offshore ASA on February 2, 2024 and sell it today you would earn a total of 40.00 from holding Solstad Offshore ASA or generate 12.54% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Xiabuxiabu Catering Management vs. Solstad Offshore ASA
Performance |
Timeline |
Xiabuxiabu Catering |
Solstad Offshore ASA |
Xiabuxiabu Catering and Solstad Offshore Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xiabuxiabu Catering and Solstad Offshore
The main advantage of trading using opposite Xiabuxiabu Catering and Solstad Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiabuxiabu Catering position performs unexpectedly, Solstad 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 Solstad Offshore will offset losses from the drop in Solstad Offshore's long position.Xiabuxiabu Catering vs. Cal Maine Foods | Xiabuxiabu Catering vs. Elmos Semiconductor SE | Xiabuxiabu Catering vs. COFCO Joycome Foods | Xiabuxiabu Catering vs. Ebro Foods SA |
Solstad Offshore vs. Cal Maine Foods | Solstad Offshore vs. QLEANAIR AB SK 50 | Solstad Offshore vs. MYFAIR GOLD P | Solstad Offshore vs. Enter Air SA |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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