Correlation Between AER Energy and Century Petroleum
Can any of the company-specific risk be diversified away by investing in both AER Energy and Century Petroleum 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 AER Energy and Century Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AER Energy Resources and Century Petroleum Corp, you can compare the effects of market volatilities on AER Energy and Century Petroleum 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 AER Energy with a short position of Century Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of AER Energy and Century Petroleum.
Diversification Opportunities for AER Energy and Century Petroleum
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AER and Century is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AER Energy Resources and Century Petroleum Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Century Petroleum Corp and AER Energy 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 AER Energy Resources are associated (or correlated) with Century Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Century Petroleum Corp has no effect on the direction of AER Energy i.e., AER Energy and Century Petroleum go up and down completely randomly.
Pair Corralation between AER Energy and Century Petroleum
Given the investment horizon of 90 days AER Energy Resources is expected to generate 14.14 times more return on investment than Century Petroleum. However, AER Energy is 14.14 times more volatile than Century Petroleum Corp. It trades about 0.06 of its potential returns per unit of risk. Century Petroleum Corp is currently generating about -0.05 per unit of risk. If you would invest 0.00 in AER Energy Resources on November 27, 2024 and sell it today you would earn a total of 0.00 from holding AER Energy Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.16% |
| Values | Daily Returns |
AER Energy Resources vs. Century Petroleum Corp
Performance |
| Timeline |
| AER Energy Resources |
| Century Petroleum Corp |
AER Energy and Century Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AER Energy and Century Petroleum
The main advantage of trading using opposite AER Energy and Century Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AER Energy position performs unexpectedly, Century Petroleum 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 Century Petroleum will offset losses from the drop in Century Petroleum's long position.| AER Energy vs. Caduceus Software Systems | AER Energy vs. North Springs Resources | AER Energy vs. Nyxio Tech Corp | AER Energy vs. Access Power Co |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |