Correlation Between AXP Energy and Calima Energy
Can any of the company-specific risk be diversified away by investing in both AXP Energy and Calima 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 AXP Energy and Calima Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AXP Energy and Calima Energy Limited, you can compare the effects of market volatilities on AXP Energy and Calima 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 AXP Energy with a short position of Calima Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of AXP Energy and Calima Energy.
Diversification Opportunities for AXP Energy and Calima Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AXP and Calima is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AXP Energy and Calima Energy Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calima Energy Limited and AXP 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 AXP Energy are associated (or correlated) with Calima Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calima Energy Limited has no effect on the direction of AXP Energy i.e., AXP Energy and Calima Energy go up and down completely randomly.
Pair Corralation between AXP Energy and Calima Energy
Assuming the 90 days horizon AXP Energy is expected to generate 2.68 times less return on investment than Calima Energy. But when comparing it to its historical volatility, AXP Energy is 4.3 times less risky than Calima Energy. It trades about 0.09 of its potential returns per unit of risk. Calima Energy Limited is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 6.50 in Calima Energy Limited on October 24, 2024 and sell it today you would lose (5.25) from holding Calima Energy Limited or give up 80.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
AXP Energy vs. Calima Energy Limited
Performance |
| Timeline |
| AXP Energy |
| Calima Energy Limited |
AXP Energy and Calima Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AXP Energy and Calima Energy
The main advantage of trading using opposite AXP Energy and Calima Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AXP Energy position performs unexpectedly, Calima 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 Calima Energy will offset losses from the drop in Calima Energy's long position.| AXP Energy vs. ADX Energy | AXP Energy vs. Calima Energy Limited | AXP Energy vs. Barrister Energy LLC | AXP Energy vs. AER Energy Resources |
| Calima Energy vs. Buru Energy Limited | Calima Energy vs. Altura Energy | Calima Energy vs. Daybreak Oil and | Calima Energy vs. Arrow Exploration Corp |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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