Correlation Between Antero Midstream and Umpqua Holdings
Can any of the company-specific risk be diversified away by investing in both Antero Midstream and Umpqua Holdings 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 Antero Midstream and Umpqua Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Antero Midstream Partners and Umpqua Holdings, you can compare the effects of market volatilities on Antero Midstream and Umpqua Holdings 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 Antero Midstream with a short position of Umpqua Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Antero Midstream and Umpqua Holdings.
Diversification Opportunities for Antero Midstream and Umpqua Holdings
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Antero and Umpqua is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Antero Midstream Partners and Umpqua Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Umpqua Holdings and Antero Midstream 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 Antero Midstream Partners are associated (or correlated) with Umpqua Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Umpqua Holdings has no effect on the direction of Antero Midstream i.e., Antero Midstream and Umpqua Holdings go up and down completely randomly.
Pair Corralation between Antero Midstream and Umpqua Holdings
Allowing for the 90-day total investment horizon Antero Midstream Partners is expected to generate 0.85 times more return on investment than Umpqua Holdings. However, Antero Midstream Partners is 1.18 times less risky than Umpqua Holdings. It trades about 0.08 of its potential returns per unit of risk. Umpqua Holdings is currently generating about 0.04 per unit of risk. If you would invest 943.00 in Antero Midstream Partners on September 13, 2024 and sell it today you would earn a total of 568.50 from holding Antero Midstream Partners or generate 60.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 9.29% |
| Values | Daily Returns |
Antero Midstream Partners vs. Umpqua Holdings
Performance |
| Timeline |
| Antero Midstream Partners |
| Umpqua Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Antero Midstream and Umpqua Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Antero Midstream and Umpqua Holdings
The main advantage of trading using opposite Antero Midstream and Umpqua Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Antero Midstream position performs unexpectedly, Umpqua Holdings 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 Umpqua Holdings will offset losses from the drop in Umpqua Holdings' long position.| Antero Midstream vs. EnLink Midstream LLC | Antero Midstream vs. Western Midstream Partners | Antero Midstream vs. Plains GP Holdings | Antero Midstream vs. Plains All American |
| Umpqua Holdings vs. Cadence Design Systems | Umpqua Holdings vs. Sapiens International | Umpqua Holdings vs. Uber Technologies | Umpqua Holdings vs. Herc Holdings |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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