Correlation Between Solstad Offshore and Garofalo Health
Can any of the company-specific risk be diversified away by investing in both Solstad Offshore and Garofalo Health 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 Garofalo Health 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 Garofalo Health Care, you can compare the effects of market volatilities on Solstad Offshore and Garofalo Health 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 Garofalo Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solstad Offshore and Garofalo Health.
Diversification Opportunities for Solstad Offshore and Garofalo Health
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Solstad and Garofalo is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Solstad Offshore ASA and Garofalo Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garofalo Health Care 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 Garofalo Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garofalo Health Care has no effect on the direction of Solstad Offshore i.e., Solstad Offshore and Garofalo Health go up and down completely randomly.
Pair Corralation between Solstad Offshore and Garofalo Health
Assuming the 90 days trading horizon Solstad Offshore ASA is expected to under-perform the Garofalo Health. In addition to that, Solstad Offshore is 1.8 times more volatile than Garofalo Health Care. It trades about -0.21 of its total potential returns per unit of risk. Garofalo Health Care is currently generating about 0.14 per unit of volatility. If you would invest 472.00 in Garofalo Health Care on August 27, 2025 and sell it today you would earn a total of 50.00 from holding Garofalo Health Care or generate 10.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Solstad Offshore ASA vs. Garofalo Health Care
Performance |
| Timeline |
| Solstad Offshore ASA |
| Garofalo Health Care |
Solstad Offshore and Garofalo Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solstad Offshore and Garofalo Health
The main advantage of trading using opposite Solstad Offshore and Garofalo Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solstad Offshore position performs unexpectedly, Garofalo Health 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 Garofalo Health will offset losses from the drop in Garofalo Health's long position.| Solstad Offshore vs. ELMOS SEMICONDUCTOR | Solstad Offshore vs. UNIVMUSIC GRPADR050 | Solstad Offshore vs. Texas Roadhouse | Solstad Offshore vs. TRAINLINE PLC LS |
| Garofalo Health vs. Harmony Gold Mining | Garofalo Health vs. Jacquet Metal Service | Garofalo Health vs. Cairo Communication SpA | Garofalo Health vs. FIREWEED METALS P |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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