Correlation Between Athabasca Oil and Kiwetinohk Energy
Can any of the company-specific risk be diversified away by investing in both Athabasca Oil and Kiwetinohk 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 Athabasca Oil and Kiwetinohk Energy 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 Kiwetinohk Energy Corp, you can compare the effects of market volatilities on Athabasca Oil and Kiwetinohk 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 Athabasca Oil with a short position of Kiwetinohk Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athabasca Oil and Kiwetinohk Energy.
Diversification Opportunities for Athabasca Oil and Kiwetinohk Energy
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Athabasca and Kiwetinohk is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Athabasca Oil Corp and Kiwetinohk Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiwetinohk Energy Corp 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 Kiwetinohk Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiwetinohk Energy Corp has no effect on the direction of Athabasca Oil i.e., Athabasca Oil and Kiwetinohk Energy go up and down completely randomly.
Pair Corralation between Athabasca Oil and Kiwetinohk Energy
Assuming the 90 days horizon Athabasca Oil Corp is expected to under-perform the Kiwetinohk Energy. In addition to that, Athabasca Oil is 2.29 times more volatile than Kiwetinohk Energy Corp. It trades about -0.32 of its total potential returns per unit of risk. Kiwetinohk Energy Corp is currently generating about 0.32 per unit of volatility. If you would invest 1,117 in Kiwetinohk Energy Corp on November 3, 2024 and sell it today you would earn a total of 63.00 from holding Kiwetinohk Energy Corp or generate 5.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athabasca Oil Corp vs. Kiwetinohk Energy Corp
Performance |
| Timeline |
| Athabasca Oil Corp |
| Kiwetinohk Energy Corp |
Athabasca Oil and Kiwetinohk Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Athabasca Oil and Kiwetinohk Energy
The main advantage of trading using opposite Athabasca Oil and Kiwetinohk Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athabasca Oil position performs unexpectedly, Kiwetinohk 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 Kiwetinohk Energy will offset losses from the drop in Kiwetinohk Energy's long position.| Athabasca Oil vs. Pine Cliff Energy | Athabasca Oil vs. Cardinal Energy | Athabasca Oil vs. Tamarack Valley Energy | Athabasca Oil vs. Saturn Oil Gas |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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