Correlation Between Camber Energy and Nine Energy
Can any of the company-specific risk be diversified away by investing in both Camber Energy and Nine 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 Camber Energy and Nine Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Camber Energy and Nine Energy Service, you can compare the effects of market volatilities on Camber Energy and Nine 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 Camber Energy with a short position of Nine Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Camber Energy and Nine Energy.
Diversification Opportunities for Camber Energy and Nine Energy
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Camber and Nine is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Camber Energy and Nine Energy Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nine Energy Service and Camber 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 Camber Energy are associated (or correlated) with Nine Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nine Energy Service has no effect on the direction of Camber Energy i.e., Camber Energy and Nine Energy go up and down completely randomly.
Pair Corralation between Camber Energy and Nine Energy
Considering the 90-day investment horizon Camber Energy is expected to under-perform the Nine Energy. In addition to that, Camber Energy is 1.34 times more volatile than Nine Energy Service. It trades about -0.1 of its total potential returns per unit of risk. Nine Energy Service is currently generating about -0.05 per unit of volatility. If you would invest 1,092 in Nine Energy Service on November 4, 2024 and sell it today you would lose (970.00) from holding Nine Energy Service or give up 88.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.15% |
| Values | Daily Returns |
Camber Energy vs. Nine Energy Service
Performance |
| Timeline |
| Camber Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nine Energy Service |
Camber Energy and Nine Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Camber Energy and Nine Energy
The main advantage of trading using opposite Camber Energy and Nine Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Camber Energy position performs unexpectedly, Nine 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 Nine Energy will offset losses from the drop in Nine Energy's long position.The idea behind Camber Energy and Nine Energy Service 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.| Nine Energy vs. Liberty Oilfield Services | Nine Energy vs. ProFrac Holding Corp | Nine Energy vs. Helix Energy Solutions | Nine Energy vs. Enerflex |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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