Correlation Between Barrel Energy and BPI Energy
Can any of the company-specific risk be diversified away by investing in both Barrel Energy and BPI 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 Barrel Energy and BPI Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barrel Energy and BPI Energy Holdings, you can compare the effects of market volatilities on Barrel Energy and BPI 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 Barrel Energy with a short position of BPI Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barrel Energy and BPI Energy.
Diversification Opportunities for Barrel Energy and BPI Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Barrel and BPI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Barrel Energy and BPI Energy Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BPI Energy Holdings and Barrel 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 Barrel Energy are associated (or correlated) with BPI Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BPI Energy Holdings has no effect on the direction of Barrel Energy i.e., Barrel Energy and BPI Energy go up and down completely randomly.
Pair Corralation between Barrel Energy and BPI Energy
If you would invest 0.89 in Barrel Energy on September 14, 2024 and sell it today you would lose (0.64) from holding Barrel Energy or give up 71.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.37% |
| Values | Daily Returns |
Barrel Energy vs. BPI Energy Holdings
Performance |
| Timeline |
| Barrel Energy |
| BPI Energy Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Barrel Energy and BPI Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barrel Energy and BPI Energy
The main advantage of trading using opposite Barrel Energy and BPI Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barrel Energy position performs unexpectedly, BPI 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 BPI Energy will offset losses from the drop in BPI Energy's long position.| Barrel Energy vs. Saturn Oil Gas | Barrel Energy vs. Foothills Exploration | Barrel Energy vs. Calima Energy Limited | Barrel Energy vs. New Frontier 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 CEOs Directory module to screen CEOs from public companies around the world.
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