Correlation Between Bisichi Mining and Occidental Petroleum

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Can any of the company-specific risk be diversified away by investing in both Bisichi Mining and Occidental Petroleum 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 Bisichi Mining and Occidental Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bisichi Mining PLC and Occidental Petroleum Corp, you can compare the effects of market volatilities on Bisichi Mining and Occidental Petroleum 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 Bisichi Mining with a short position of Occidental Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bisichi Mining and Occidental Petroleum.

Diversification Opportunities for Bisichi Mining and Occidental Petroleum

-0.35
  Correlation Coefficient

Very good diversification

The 3 months correlation between Bisichi and Occidental is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Bisichi Mining PLC and Occidental Petroleum Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Occidental Petroleum Corp and Bisichi Mining 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 Bisichi Mining PLC are associated (or correlated) with Occidental Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Occidental Petroleum Corp has no effect on the direction of Bisichi Mining i.e., Bisichi Mining and Occidental Petroleum go up and down completely randomly.

Pair Corralation between Bisichi Mining and Occidental Petroleum

Assuming the 90 days trading horizon Bisichi Mining PLC is expected to under-perform the Occidental Petroleum. In addition to that, Bisichi Mining is 1.91 times more volatile than Occidental Petroleum Corp. It trades about -0.06 of its total potential returns per unit of risk. Occidental Petroleum Corp is currently generating about 0.01 per unit of volatility. If you would invest  5,068  in Occidental Petroleum Corp on August 28, 2024 and sell it today you would lose (2.00) from holding Occidental Petroleum Corp or give up 0.04% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Bisichi Mining PLC  vs.  Occidental Petroleum Corp

 Performance 
       Timeline  
Bisichi Mining PLC 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Bisichi Mining PLC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Bisichi Mining unveiled solid returns over the last few months and may actually be approaching a breakup point.
Occidental Petroleum Corp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Occidental Petroleum Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Bisichi Mining and Occidental Petroleum Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bisichi Mining and Occidental Petroleum

The main advantage of trading using opposite Bisichi Mining and Occidental Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bisichi Mining position performs unexpectedly, Occidental Petroleum 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 Occidental Petroleum will offset losses from the drop in Occidental Petroleum's long position.
The idea behind Bisichi Mining PLC and Occidental Petroleum Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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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