Correlation Between Calfrac Well and POSCO Holdings
Can any of the company-specific risk be diversified away by investing in both Calfrac Well and POSCO Holdings 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 POSCO Holdings 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 POSCO Holdings, you can compare the effects of market volatilities on Calfrac Well and POSCO Holdings 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 POSCO Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calfrac Well and POSCO Holdings.
Diversification Opportunities for Calfrac Well and POSCO Holdings
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Calfrac and POSCO is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Calfrac Well Services and POSCO Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POSCO Holdings 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 POSCO Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POSCO Holdings has no effect on the direction of Calfrac Well i.e., Calfrac Well and POSCO Holdings go up and down completely randomly.
Pair Corralation between Calfrac Well and POSCO Holdings
Assuming the 90 days horizon Calfrac Well Services is expected to generate 0.88 times more return on investment than POSCO Holdings. However, Calfrac Well Services is 1.14 times less risky than POSCO Holdings. It trades about -0.05 of its potential returns per unit of risk. POSCO Holdings is currently generating about -0.1 per unit of risk. If you would invest 296.00 in Calfrac Well Services on December 4, 2024 and sell it today you would lose (38.00) from holding Calfrac Well Services or give up 12.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.98% |
| Values | Daily Returns |
Calfrac Well Services vs. POSCO Holdings
Performance |
| Timeline |
| Calfrac Well Services |
| POSCO Holdings |
Calfrac Well and POSCO Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calfrac Well and POSCO Holdings
The main advantage of trading using opposite Calfrac Well and POSCO Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calfrac Well position performs unexpectedly, POSCO Holdings 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 POSCO Holdings will offset losses from the drop in POSCO Holdings' long position.| Calfrac Well vs. Greenway Technologies | Calfrac Well vs. Akastor ASA | Calfrac Well vs. Auri Inc | Calfrac Well vs. Us Energy Initiative |
| POSCO Holdings vs. Fortitude Gold Corp | POSCO Holdings vs. New Gold | POSCO Holdings vs. Galiano Gold | POSCO Holdings vs. GoldMining |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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