Correlation Between SBM Offshore and China Clean
Can any of the company-specific risk be diversified away by investing in both SBM Offshore and China Clean 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 SBM Offshore and China Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SBM Offshore NV and China Clean Energy, you can compare the effects of market volatilities on SBM Offshore and China Clean 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 SBM Offshore with a short position of China Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBM Offshore and China Clean.
Diversification Opportunities for SBM Offshore and China Clean
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SBM and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SBM Offshore NV and China Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Clean Energy and SBM 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 SBM Offshore NV are associated (or correlated) with China Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Clean Energy has no effect on the direction of SBM Offshore i.e., SBM Offshore and China Clean go up and down completely randomly.
Pair Corralation between SBM Offshore and China Clean
If you would invest 1,700 in SBM Offshore NV on December 18, 2024 and sell it today you would earn a total of 585.00 from holding SBM Offshore NV or generate 34.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 98.36% |
Values | Daily Returns |
SBM Offshore NV vs. China Clean Energy
Performance |
Timeline |
SBM Offshore NV |
China Clean Energy |
SBM Offshore and China Clean Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SBM Offshore and China Clean
The main advantage of trading using opposite SBM Offshore and China Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBM Offshore position performs unexpectedly, China Clean 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 Clean will offset losses from the drop in China Clean's long position.SBM Offshore vs. Expro Group Holdings | SBM Offshore vs. ChampionX | SBM Offshore vs. Ranger Energy Services | SBM Offshore vs. Cactus Inc |
China Clean vs. Webus International Limited | China Clean vs. Genuine Parts Co | China Clean vs. CVR Energy | China Clean vs. Cedar Realty Trust |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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