Correlation Between Cabo Drilling and Nabors Industries
Can any of the company-specific risk be diversified away by investing in both Cabo Drilling and Nabors Industries 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 Cabo Drilling and Nabors Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cabo Drilling Corp and Nabors Industries, you can compare the effects of market volatilities on Cabo Drilling and Nabors Industries 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 Cabo Drilling with a short position of Nabors Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cabo Drilling and Nabors Industries.
Diversification Opportunities for Cabo Drilling and Nabors Industries
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cabo and Nabors is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cabo Drilling Corp and Nabors Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nabors Industries and Cabo Drilling 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 Cabo Drilling Corp are associated (or correlated) with Nabors Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nabors Industries has no effect on the direction of Cabo Drilling i.e., Cabo Drilling and Nabors Industries go up and down completely randomly.
Pair Corralation between Cabo Drilling and Nabors Industries
If you would invest 0.01 in Cabo Drilling Corp on November 27, 2024 and sell it today you would earn a total of 0.00 from holding Cabo Drilling Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cabo Drilling Corp vs. Nabors Industries
Performance |
| Timeline |
| Cabo Drilling Corp |
| Nabors Industries |
Cabo Drilling and Nabors Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cabo Drilling and Nabors Industries
The main advantage of trading using opposite Cabo Drilling and Nabors Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cabo Drilling position performs unexpectedly, Nabors Industries 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 Nabors Industries will offset losses from the drop in Nabors Industries' long position.| Cabo Drilling vs. CleanGo Innovations | Cabo Drilling vs. PPG Industries | Cabo Drilling vs. Boyd Gaming | Cabo Drilling vs. Biglari Holdings |
| Nabors Industries vs. Helmerich and Payne | Nabors Industries vs. Precision Drilling | Nabors Industries vs. Seadrill Limited | Nabors Industries vs. Borr Drilling |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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