Correlation Between Armada Hflr and Occidental Petroleum
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and Occidental 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 Armada Hflr and Occidental Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and Occidental Petroleum, you can compare the effects of market volatilities on Armada Hflr and Occidental 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 Armada Hflr with a short position of Occidental Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Occidental Petroleum.
Diversification Opportunities for Armada Hflr and Occidental Petroleum
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Armada and Occidental is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and Occidental Petroleum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Occidental Petroleum and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with Occidental Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Occidental Petroleum has no effect on the direction of Armada Hflr i.e., Armada Hflr and Occidental Petroleum go up and down completely randomly.
Pair Corralation between Armada Hflr and Occidental Petroleum
Considering the 90-day investment horizon Armada Hflr Pr is expected to generate 0.5 times more return on investment than Occidental Petroleum. However, Armada Hflr Pr is 2.0 times less risky than Occidental Petroleum. It trades about -0.11 of its potential returns per unit of risk. Occidental Petroleum is currently generating about -0.07 per unit of risk. If you would invest 1,108 in Armada Hflr Pr on September 12, 2024 and sell it today you would lose (23.00) from holding Armada Hflr Pr or give up 2.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Armada Hflr Pr vs. Occidental Petroleum
Performance |
| Timeline |
| Armada Hflr Pr |
| Occidental Petroleum |
Armada Hflr and Occidental Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Hflr and Occidental Petroleum
The main advantage of trading using opposite Armada Hflr and Occidental Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, Occidental 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 Occidental Petroleum will offset losses from the drop in Occidental Petroleum's long position.| Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
| Occidental Petroleum vs. GLG LIFE TECH | Occidental Petroleum vs. ZURICH INSURANCE GROUP | Occidental Petroleum vs. MSAD INSURANCE | Occidental Petroleum vs. Axcelis Technologies |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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