Correlation Between InPlay Oil and ALTAIR RES
Can any of the company-specific risk be diversified away by investing in both InPlay Oil and ALTAIR RES 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 InPlay Oil and ALTAIR RES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InPlay Oil Corp and ALTAIR RES INC, you can compare the effects of market volatilities on InPlay Oil and ALTAIR RES 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 InPlay Oil with a short position of ALTAIR RES. Check out your portfolio center. Please also check ongoing floating volatility patterns of InPlay Oil and ALTAIR RES.
Diversification Opportunities for InPlay Oil and ALTAIR RES
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between InPlay and ALTAIR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding InPlay Oil Corp and ALTAIR RES INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALTAIR RES INC and InPlay Oil 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 InPlay Oil Corp are associated (or correlated) with ALTAIR RES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALTAIR RES INC has no effect on the direction of InPlay Oil i.e., InPlay Oil and ALTAIR RES go up and down completely randomly.
Pair Corralation between InPlay Oil and ALTAIR RES
Assuming the 90 days trading horizon InPlay Oil Corp is expected to under-perform the ALTAIR RES. But the stock apears to be less risky and, when comparing its historical volatility, InPlay Oil Corp is 26.51 times less risky than ALTAIR RES. The stock trades about -0.02 of its potential returns per unit of risk. The ALTAIR RES INC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.75 in ALTAIR RES INC on October 13, 2024 and sell it today you would lose (0.70) from holding ALTAIR RES INC or give up 93.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
InPlay Oil Corp vs. ALTAIR RES INC
Performance |
| Timeline |
| InPlay Oil Corp |
| ALTAIR RES INC |
InPlay Oil and ALTAIR RES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InPlay Oil and ALTAIR RES
The main advantage of trading using opposite InPlay Oil and ALTAIR RES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InPlay Oil position performs unexpectedly, ALTAIR RES 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 ALTAIR RES will offset losses from the drop in ALTAIR RES's long position.| InPlay Oil vs. Monster Beverage Corp | InPlay Oil vs. National Beverage Corp | InPlay Oil vs. BOSTON BEER A | InPlay Oil vs. Molson Coors Beverage |
| ALTAIR RES vs. NEWELL RUBBERMAID | ALTAIR RES vs. FEMALE HEALTH | ALTAIR RES vs. UNIVERSAL MUSIC GROUP | ALTAIR RES vs. UNIDOC HEALTH 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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