Correlation Between Athabasca Oil and Canadian Natural
Can any of the company-specific risk be diversified away by investing in both Athabasca Oil and Canadian Natural 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 Athabasca Oil and Canadian Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Athabasca Oil Corp and Canadian Natural Resources, you can compare the effects of market volatilities on Athabasca Oil and Canadian Natural 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 Athabasca Oil with a short position of Canadian Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athabasca Oil and Canadian Natural.
Diversification Opportunities for Athabasca Oil and Canadian Natural
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Athabasca and Canadian is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Athabasca Oil Corp and Canadian Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Natural Res and Athabasca 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 Athabasca Oil Corp are associated (or correlated) with Canadian Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Natural Res has no effect on the direction of Athabasca Oil i.e., Athabasca Oil and Canadian Natural go up and down completely randomly.
Pair Corralation between Athabasca Oil and Canadian Natural
Assuming the 90 days trading horizon Athabasca Oil Corp is expected to generate 1.52 times more return on investment than Canadian Natural. However, Athabasca Oil is 1.52 times more volatile than Canadian Natural Resources. It trades about 0.12 of its potential returns per unit of risk. Canadian Natural Resources is currently generating about -0.04 per unit of risk. If you would invest 506.00 in Athabasca Oil Corp on August 27, 2024 and sell it today you would earn a total of 25.00 from holding Athabasca Oil Corp or generate 4.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athabasca Oil Corp vs. Canadian Natural Resources
Performance |
| Timeline |
| Athabasca Oil Corp |
| Canadian Natural Res |
Athabasca Oil and Canadian Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Athabasca Oil and Canadian Natural
The main advantage of trading using opposite Athabasca Oil and Canadian Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athabasca Oil position performs unexpectedly, Canadian Natural 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 Canadian Natural will offset losses from the drop in Canadian Natural's long position.| Athabasca Oil vs. Baytex Energy Corp | Athabasca Oil vs. Tamarack Valley Energy | Athabasca Oil vs. MEG Energy Corp | Athabasca Oil vs. Cardinal Energy |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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