Correlation Between Solstad Offshore and BJs Wholesale
Can any of the company-specific risk be diversified away by investing in both Solstad Offshore and BJs Wholesale 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 Solstad Offshore and BJs Wholesale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solstad Offshore ASA and BJs Wholesale Club, you can compare the effects of market volatilities on Solstad Offshore and BJs Wholesale 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 Solstad Offshore with a short position of BJs Wholesale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solstad Offshore and BJs Wholesale.
Diversification Opportunities for Solstad Offshore and BJs Wholesale
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Solstad and BJs is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Solstad Offshore ASA and BJs Wholesale Club in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Wholesale Club and Solstad 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 Solstad Offshore ASA are associated (or correlated) with BJs Wholesale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Wholesale Club has no effect on the direction of Solstad Offshore i.e., Solstad Offshore and BJs Wholesale go up and down completely randomly.
Pair Corralation between Solstad Offshore and BJs Wholesale
Assuming the 90 days trading horizon Solstad Offshore ASA is expected to under-perform the BJs Wholesale. But the stock apears to be less risky and, when comparing its historical volatility, Solstad Offshore ASA is 1.22 times less risky than BJs Wholesale. The stock trades about -0.02 of its potential returns per unit of risk. The BJs Wholesale Club is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 8,800 in BJs Wholesale Club on December 29, 2024 and sell it today you would earn a total of 1,500 from holding BJs Wholesale Club or generate 17.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Solstad Offshore ASA vs. BJs Wholesale Club
Performance |
Timeline |
Solstad Offshore ASA |
BJs Wholesale Club |
Solstad Offshore and BJs Wholesale Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Solstad Offshore and BJs Wholesale
The main advantage of trading using opposite Solstad Offshore and BJs Wholesale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solstad Offshore position performs unexpectedly, BJs Wholesale 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 BJs Wholesale will offset losses from the drop in BJs Wholesale's long position.Solstad Offshore vs. CENTURIA OFFICE REIT | Solstad Offshore vs. Benchmark Electronics | Solstad Offshore vs. ELECTRONIC ARTS | Solstad Offshore vs. Arrow Electronics |
BJs Wholesale vs. Walmart | BJs Wholesale vs. Walmart | BJs Wholesale vs. Costco Wholesale | BJs Wholesale vs. Wal Mart de Mxico |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |