Correlation Between Abraxas Petroleum and PHX Minerals
Can any of the company-specific risk be diversified away by investing in both Abraxas Petroleum and PHX Minerals 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 Abraxas Petroleum and PHX Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abraxas Petroleum and PHX Minerals, you can compare the effects of market volatilities on Abraxas Petroleum and PHX Minerals 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 Abraxas Petroleum with a short position of PHX Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abraxas Petroleum and PHX Minerals.
Diversification Opportunities for Abraxas Petroleum and PHX Minerals
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Abraxas and PHX is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Abraxas Petroleum and PHX Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PHX Minerals and Abraxas Petroleum 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 Abraxas Petroleum are associated (or correlated) with PHX Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PHX Minerals has no effect on the direction of Abraxas Petroleum i.e., Abraxas Petroleum and PHX Minerals go up and down completely randomly.
Pair Corralation between Abraxas Petroleum and PHX Minerals
If you would invest 353.00 in PHX Minerals on August 30, 2024 and sell it today you would earn a total of 19.00 from holding PHX Minerals or generate 5.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Abraxas Petroleum vs. PHX Minerals
Performance |
| Timeline |
| Abraxas Petroleum |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| PHX Minerals |
Abraxas Petroleum and PHX Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abraxas Petroleum and PHX Minerals
The main advantage of trading using opposite Abraxas Petroleum and PHX Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abraxas Petroleum position performs unexpectedly, PHX Minerals 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 PHX Minerals will offset losses from the drop in PHX Minerals' long position.| Abraxas Petroleum vs. Tullow Oil plc | Abraxas Petroleum vs. Rockhopper Exploration plc | Abraxas Petroleum vs. Civitas Resources | Abraxas Petroleum vs. Civitas Resources |
| PHX Minerals vs. Evolution Petroleum | PHX Minerals vs. GeoPark | PHX Minerals vs. Granite Ridge Resources | PHX Minerals vs. California Resources 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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