Correlation Between DETALION GAMES and Eidesvik Offshore

Can any of the company-specific risk be diversified away by investing in both DETALION GAMES and Eidesvik 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 DETALION GAMES and Eidesvik Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DETALION GAMES SA and Eidesvik Offshore ASA, you can compare the effects of market volatilities on DETALION GAMES and Eidesvik 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 DETALION GAMES with a short position of Eidesvik Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of DETALION GAMES and Eidesvik Offshore.

Diversification Opportunities for DETALION GAMES and Eidesvik Offshore

0.57

Correlation Coefficient

DETALION GAMES  Eidesvik Offshore

Very weak diversification

The 3 months correlation between DETALION and Eidesvik is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding DETALION GAMES SA and Eidesvik Offshore ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eidesvik Offshore ASA and DETALION GAMES 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 DETALION GAMES SA are associated (or correlated) with Eidesvik Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eidesvik Offshore ASA has no effect on the direction of DETALION GAMES i.e., DETALION GAMES and Eidesvik Offshore go up and down completely randomly.

Pair Corralation between DETALION GAMES and Eidesvik Offshore

Assuming the 90 days horizon DETALION GAMES SA is expected to generate 3.62 times more return on investment than Eidesvik Offshore. However, DETALION GAMES is 3.62 times more volatile than Eidesvik Offshore ASA. It trades about 0.08 of its potential returns per unit of risk. Eidesvik Offshore ASA is currently generating about -0.16 per unit of risk. If you would invest  17.00  in DETALION GAMES SA on September 23, 2024 and sell it today you would earn a total of  1.00  from holding DETALION GAMES SA or generate 5.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

DETALION GAMES SA  vs.  Eidesvik Offshore ASA

DETALION GAMES SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DETALION GAMES SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Eidesvik Offshore ASA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eidesvik Offshore ASA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with DETALION GAMES and Eidesvik Offshore

The main advantage of trading using opposite DETALION GAMES and Eidesvik Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DETALION GAMES position performs unexpectedly, Eidesvik 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 Eidesvik Offshore will offset losses from the drop in Eidesvik Offshore's long position.

The idea behind DETALION GAMES SA and Eidesvik 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.

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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.