Correlation Between SIEM OFFSHORE and China BlueChemical
Can any of the company-specific risk be diversified away by investing in both SIEM OFFSHORE and China BlueChemical 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 SIEM OFFSHORE and China BlueChemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIEM OFFSHORE NEW and China BlueChemical, you can compare the effects of market volatilities on SIEM OFFSHORE and China BlueChemical 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 SIEM OFFSHORE with a short position of China BlueChemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIEM OFFSHORE and China BlueChemical.
Diversification Opportunities for SIEM OFFSHORE and China BlueChemical
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SIEM and China is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding SIEM OFFSHORE NEW and China BlueChemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China BlueChemical and SIEM 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 SIEM OFFSHORE NEW are associated (or correlated) with China BlueChemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China BlueChemical has no effect on the direction of SIEM OFFSHORE i.e., SIEM OFFSHORE and China BlueChemical go up and down completely randomly.
Pair Corralation between SIEM OFFSHORE and China BlueChemical
Assuming the 90 days trading horizon SIEM OFFSHORE NEW is expected to generate 1.56 times more return on investment than China BlueChemical. However, SIEM OFFSHORE is 1.56 times more volatile than China BlueChemical. It trades about -0.01 of its potential returns per unit of risk. China BlueChemical is currently generating about -0.03 per unit of risk. If you would invest 204.00 in SIEM OFFSHORE NEW on December 27, 2024 and sell it today you would lose (21.00) from holding SIEM OFFSHORE NEW or give up 10.29% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SIEM OFFSHORE NEW vs. China BlueChemical
Performance |
Timeline |
SIEM OFFSHORE NEW |
China BlueChemical |
SIEM OFFSHORE and China BlueChemical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SIEM OFFSHORE and China BlueChemical
The main advantage of trading using opposite SIEM OFFSHORE and China BlueChemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIEM OFFSHORE position performs unexpectedly, China BlueChemical 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 China BlueChemical will offset losses from the drop in China BlueChemical's long position.SIEM OFFSHORE vs. Haverty Furniture Companies | SIEM OFFSHORE vs. NORWEGIAN AIR SHUT | SIEM OFFSHORE vs. HAVERTY FURNITURE A | SIEM OFFSHORE vs. QLEANAIR AB SK 50 |
China BlueChemical vs. COMPUGROUP MEDICAL V | China BlueChemical vs. CORNISH METALS INC | China BlueChemical vs. Advanced Medical Solutions | China BlueChemical vs. Compugroup Medical SE |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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