Correlation Between Eidesvik Offshore and EPlay Digital

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

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

Diversification Opportunities for Eidesvik Offshore and EPlay Digital

0.0

Correlation Coefficient

Eidesvik Offshore  EPlay Digital

Pay attention - limited upside

The 3 months correlation between Eidesvik and EPlay is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eidesvik Offshore ASA and ePlay Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ePlay Digital and Eidesvik 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 Eidesvik Offshore ASA are associated (or correlated) with EPlay Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ePlay Digital has no effect on the direction of Eidesvik Offshore i.e., Eidesvik Offshore and EPlay Digital go up and down completely randomly.

Pair Corralation between Eidesvik Offshore and EPlay Digital

If you would invest  0.10  in ePlay Digital on December 31, 2024 and sell it today you would earn a total of  0.00  from holding ePlay Digital or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Eidesvik Offshore ASA  vs.  ePlay Digital

Eidesvik Offshore ASA

Risk-Adjusted Performance

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 fragile 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.

ePlay Digital

Risk-Adjusted Performance

Very Weak

Over the last 90 days ePlay Digital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, EPlay Digital is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Eidesvik Offshore and EPlay Digital

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

The idea behind Eidesvik Offshore ASA and ePlay Digital 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.