Correlation Between Caseys General and Solstad Offshore
Can any of the company-specific risk be diversified away by investing in both Caseys General 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 Caseys General and Solstad Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caseys General Stores and Solstad Offshore ASA, you can compare the effects of market volatilities on Caseys General 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 Caseys General with a short position of Solstad Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caseys General and Solstad Offshore.
Diversification Opportunities for Caseys General and Solstad Offshore
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Caseys and Solstad is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Caseys General Stores 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 Caseys General 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 Caseys General Stores 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 Caseys General i.e., Caseys General and Solstad Offshore go up and down completely randomly.
Pair Corralation between Caseys General and Solstad Offshore
Assuming the 90 days trading horizon Caseys General Stores is expected to generate 1.0 times more return on investment than Solstad Offshore. However, Caseys General Stores is 1.0 times less risky than Solstad Offshore. It trades about 0.04 of its potential returns per unit of risk. Solstad Offshore ASA is currently generating about -0.02 per unit of risk. If you would invest 38,352 in Caseys General Stores on December 30, 2024 and sell it today you would earn a total of 1,448 from holding Caseys General Stores or generate 3.78% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Caseys General Stores vs. Solstad Offshore ASA
Performance |
Timeline |
Caseys General Stores |
Solstad Offshore ASA |
Caseys General and Solstad Offshore Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Caseys General and Solstad Offshore
The main advantage of trading using opposite Caseys General and Solstad Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caseys General 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.Caseys General vs. Maple Leaf Foods | Caseys General vs. GOLD ROAD RES | Caseys General vs. SAFEROADS HLDGS | Caseys General vs. BROADPEAK SA EO |
Solstad Offshore vs. PARKEN Sport Entertainment | Solstad Offshore vs. East Africa Metals | Solstad Offshore vs. AMAG Austria Metall | Solstad Offshore vs. RELIANCE STEEL AL |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Equity Valuation Check real value of public entities based on technical and fundamental data |