Correlation Between Alamo Energy and Crew Energy
Can any of the company-specific risk be diversified away by investing in both Alamo Energy and Crew Energy 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 Alamo Energy and Crew Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alamo Energy Corp and Crew Energy, you can compare the effects of market volatilities on Alamo Energy and Crew Energy 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 Alamo Energy with a short position of Crew Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alamo Energy and Crew Energy.
Diversification Opportunities for Alamo Energy and Crew Energy
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alamo and Crew is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Alamo Energy Corp and Crew Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crew Energy and Alamo 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 Alamo Energy Corp are associated (or correlated) with Crew Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crew Energy has no effect on the direction of Alamo Energy i.e., Alamo Energy and Crew Energy go up and down completely randomly.
Pair Corralation between Alamo Energy and Crew Energy
Given the investment horizon of 90 days Alamo Energy Corp is expected to generate 14.53 times more return on investment than Crew Energy. However, Alamo Energy is 14.53 times more volatile than Crew Energy. It trades about 0.06 of its potential returns per unit of risk. Crew Energy is currently generating about 0.03 per unit of risk. If you would invest 0.01 in Alamo Energy Corp on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Alamo Energy Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 92.73% |
| Values | Daily Returns |
Alamo Energy Corp vs. Crew Energy
Performance |
| Timeline |
| Alamo Energy Corp |
| Crew Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Alamo Energy and Crew Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alamo Energy and Crew Energy
The main advantage of trading using opposite Alamo Energy and Crew Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alamo Energy position performs unexpectedly, Crew Energy 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 Crew Energy will offset losses from the drop in Crew Energy's long position.| Alamo Energy vs. AER Energy Resources | Alamo Energy vs. Altura Energy | Alamo Energy vs. Arete Industries | Alamo Energy vs. Strat Petroleum |
| Crew Energy vs. Surge Energy | Crew Energy vs. Athabasca Oil Corp | Crew Energy vs. Birchcliff Energy | Crew Energy vs. Tamarack Valley Energy |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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