Correlation Between UNIVMUSIC GRPADR/050 and Solstad Offshore

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both UNIVMUSIC GRPADR/050 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 UNIVMUSIC GRPADR/050 and Solstad Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UNIVMUSIC GRPADR050 and Solstad Offshore ASA, you can compare the effects of market volatilities on UNIVMUSIC GRPADR/050 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 UNIVMUSIC GRPADR/050 with a short position of Solstad Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIVMUSIC GRPADR/050 and Solstad Offshore.

Diversification Opportunities for UNIVMUSIC GRPADR/050 and Solstad Offshore

UNIVMUSICSolstadDiversified AwayUNIVMUSICSolstadDiversified Away100%
0.13
  Correlation Coefficient

Average diversification

The 3 months correlation between UNIVMUSIC and Solstad is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding UNIVMUSIC GRPADR050 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 UNIVMUSIC GRPADR/050 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 UNIVMUSIC GRPADR050 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 UNIVMUSIC GRPADR/050 i.e., UNIVMUSIC GRPADR/050 and Solstad Offshore go up and down completely randomly.

Pair Corralation between UNIVMUSIC GRPADR/050 and Solstad Offshore

Assuming the 90 days trading horizon UNIVMUSIC GRPADR/050 is expected to generate 21.29 times less return on investment than Solstad Offshore. But when comparing it to its historical volatility, UNIVMUSIC GRPADR050 is 2.82 times less risky than Solstad Offshore. It trades about 0.02 of its potential returns per unit of risk. Solstad Offshore ASA is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  258.00  in Solstad Offshore ASA on October 20, 2024 and sell it today you would earn a total of  76.00  from holding Solstad Offshore ASA or generate 29.46% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

UNIVMUSIC GRPADR050  vs.  Solstad Offshore ASA

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -1001020
JavaScript chart by amCharts 3.21.150VD0 SZL
       Timeline  
UNIVMUSIC GRPADR/050 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in UNIVMUSIC GRPADR050 are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable fundamental indicators, UNIVMUSIC GRPADR/050 is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan1111.211.411.611.81212.2
Solstad Offshore ASA 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Solstad Offshore ASA are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Solstad Offshore unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan2.62.833.23.43.63.8

UNIVMUSIC GRPADR/050 and Solstad Offshore Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.24-3.18-2.11-1.050.01771.062.143.214.29 0.050.100.150.20
JavaScript chart by amCharts 3.21.150VD0 SZL
       Returns  

Pair Trading with UNIVMUSIC GRPADR/050 and Solstad Offshore

The main advantage of trading using opposite UNIVMUSIC GRPADR/050 and Solstad Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNIVMUSIC GRPADR/050 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.
The idea behind UNIVMUSIC GRPADR050 and Solstad Offshore ASA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

Other Complementary Tools

Commodity Channel
Use Commodity Channel Index to analyze current equity momentum
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
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