Correlation Between Eidesvik Offshore and USU Software

Can any of the company-specific risk be diversified away by investing in both Eidesvik Offshore and USU Software 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 USU Software 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 USU Software AG, you can compare the effects of market volatilities on Eidesvik Offshore and USU Software 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 USU Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eidesvik Offshore and USU Software.

Diversification Opportunities for Eidesvik Offshore and USU Software

0.19

Correlation Coefficient

Eidesvik Offshore  USU Software

Average diversification

The 3 months correlation between Eidesvik and USU is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Eidesvik Offshore ASA and USU Software AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USU Software AG 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 USU Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USU Software AG has no effect on the direction of Eidesvik Offshore i.e., Eidesvik Offshore and USU Software go up and down completely randomly.

Pair Corralation between Eidesvik Offshore and USU Software

Assuming the 90 days trading horizon Eidesvik Offshore ASA is expected to generate 0.32 times more return on investment than USU Software. However, Eidesvik Offshore ASA is 3.14 times less risky than USU Software. It trades about 0.09 of its potential returns per unit of risk. USU Software AG is currently generating about -0.12 per unit of risk. If you would invest  91.00  in Eidesvik Offshore ASA on April 20, 2025 and sell it today you would earn a total of  11.00  from holding Eidesvik Offshore ASA or generate 12.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Eidesvik Offshore ASA  vs.  USU Software AG

Eidesvik Offshore ASA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Eidesvik Offshore ASA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Eidesvik Offshore unveiled solid returns over the last few months and may actually be approaching a breakup point.

USU Software AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days USU Software AG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Eidesvik Offshore and USU Software

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

The idea behind Eidesvik Offshore ASA and USU Software AG 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.