Correlation Between Birchcliff Energy and Trican Well
Can any of the company-specific risk be diversified away by investing in both Birchcliff Energy and Trican Well 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 Birchcliff Energy and Trican Well into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Birchcliff Energy and Trican Well Service, you can compare the effects of market volatilities on Birchcliff Energy and Trican Well 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 Birchcliff Energy with a short position of Trican Well. Check out your portfolio center. Please also check ongoing floating volatility patterns of Birchcliff Energy and Trican Well.
Diversification Opportunities for Birchcliff Energy and Trican Well
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Birchcliff and Trican is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Birchcliff Energy and Trican Well Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trican Well Service and Birchcliff 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 Birchcliff Energy are associated (or correlated) with Trican Well. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trican Well Service has no effect on the direction of Birchcliff Energy i.e., Birchcliff Energy and Trican Well go up and down completely randomly.
Pair Corralation between Birchcliff Energy and Trican Well
Assuming the 90 days trading horizon Birchcliff Energy is expected to generate 1.14 times more return on investment than Trican Well. However, Birchcliff Energy is 1.14 times more volatile than Trican Well Service. It trades about 0.01 of its potential returns per unit of risk. Trican Well Service is currently generating about -0.34 per unit of risk. If you would invest 579.00 in Birchcliff Energy on November 18, 2024 and sell it today you would earn a total of 0.00 from holding Birchcliff Energy or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Birchcliff Energy vs. Trican Well Service
Performance |
| Timeline |
| Birchcliff Energy |
| Trican Well Service |
Birchcliff Energy and Trican Well Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Birchcliff Energy and Trican Well
The main advantage of trading using opposite Birchcliff Energy and Trican Well positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Birchcliff Energy position performs unexpectedly, Trican Well 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 Trican Well will offset losses from the drop in Trican Well's long position.| Birchcliff Energy vs. Tourmaline Oil Corp | Birchcliff Energy vs. ARC Resources | Birchcliff Energy vs. NuVista Energy | Birchcliff Energy vs. Whitecap Resources |
| Trican Well vs. Calfrac Well Services | Trican Well vs. Precision Drilling | Trican Well vs. Ensign Energy Services | Trican Well vs. Birchcliff Energy |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |