Correlation Between Calfrac Well and Forum Energy
Can any of the company-specific risk be diversified away by investing in both Calfrac Well and Forum 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 Calfrac Well and Forum Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calfrac Well Services and Forum Energy Metals, you can compare the effects of market volatilities on Calfrac Well and Forum 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 Calfrac Well with a short position of Forum Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calfrac Well and Forum Energy.
Diversification Opportunities for Calfrac Well and Forum Energy
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Calfrac and Forum is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Calfrac Well Services and Forum Energy Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forum Energy Metals and Calfrac Well 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 Calfrac Well Services are associated (or correlated) with Forum Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forum Energy Metals has no effect on the direction of Calfrac Well i.e., Calfrac Well and Forum Energy go up and down completely randomly.
Pair Corralation between Calfrac Well and Forum Energy
Assuming the 90 days trading horizon Calfrac Well Services is expected to generate 0.15 times more return on investment than Forum Energy. However, Calfrac Well Services is 6.5 times less risky than Forum Energy. It trades about 0.01 of its potential returns per unit of risk. Forum Energy Metals is currently generating about -0.22 per unit of risk. If you would invest 391.00 in Calfrac Well Services on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Calfrac Well Services or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calfrac Well Services vs. Forum Energy Metals
Performance |
| Timeline |
| Calfrac Well Services |
| Forum Energy Metals |
Calfrac Well and Forum Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calfrac Well and Forum Energy
The main advantage of trading using opposite Calfrac Well and Forum Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calfrac Well position performs unexpectedly, Forum 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 Forum Energy will offset losses from the drop in Forum Energy's long position.| Calfrac Well vs. Trican Well Service | Calfrac Well vs. Ensign Energy Services | Calfrac Well vs. Precision Drilling | Calfrac Well vs. Secure Energy Services |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |