Correlation Between Cortus Energy and Africa Oil
Can any of the company-specific risk be diversified away by investing in both Cortus Energy and Africa Oil 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 Cortus Energy and Africa Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cortus Energy AB and Africa Oil Corp, you can compare the effects of market volatilities on Cortus Energy and Africa Oil 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 Cortus Energy with a short position of Africa Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cortus Energy and Africa Oil.
Diversification Opportunities for Cortus Energy and Africa Oil
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cortus and Africa is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Cortus Energy AB and Africa Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Africa Oil Corp and Cortus 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 Cortus Energy AB are associated (or correlated) with Africa Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Africa Oil Corp has no effect on the direction of Cortus Energy i.e., Cortus Energy and Africa Oil go up and down completely randomly.
Pair Corralation between Cortus Energy and Africa Oil
Assuming the 90 days horizon Cortus Energy AB is expected to under-perform the Africa Oil. In addition to that, Cortus Energy is 6.31 times more volatile than Africa Oil Corp. It trades about -0.04 of its total potential returns per unit of risk. Africa Oil Corp is currently generating about -0.03 per unit of volatility. If you would invest 1,756 in Africa Oil Corp on November 5, 2024 and sell it today you would lose (301.00) from holding Africa Oil Corp or give up 17.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cortus Energy AB vs. Africa Oil Corp
Performance |
| Timeline |
| Cortus Energy AB |
| Africa Oil Corp |
Cortus Energy and Africa Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cortus Energy and Africa Oil
The main advantage of trading using opposite Cortus Energy and Africa Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cortus Energy position performs unexpectedly, Africa Oil 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 Africa Oil will offset losses from the drop in Africa Oil's long position.| Cortus Energy vs. SolTech Energy Sweden | Cortus Energy vs. Minesto AB | Cortus Energy vs. SaltX Technology Holding | Cortus Energy vs. Impact Coatings publ |
| Africa Oil vs. International Petroleum | Africa Oil vs. Africa Energy Corp | Africa Oil vs. Africa Oil Corp | Africa Oil vs. Lundin Mining |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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