Correlation Between Calfrac Well and US Silica
Can any of the company-specific risk be diversified away by investing in both Calfrac Well and US Silica 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 US Silica 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 US Silica Holdings, you can compare the effects of market volatilities on Calfrac Well and US Silica 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 US Silica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calfrac Well and US Silica.
Diversification Opportunities for Calfrac Well and US Silica
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Calfrac and SLCA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Calfrac Well Services and US Silica Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Silica 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 US Silica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Silica Holdings has no effect on the direction of Calfrac Well i.e., Calfrac Well and US Silica go up and down completely randomly.
Pair Corralation between Calfrac Well and US Silica
If you would invest (100.00) in US Silica Holdings on January 10, 2025 and sell it today you would earn a total of 100.00 from holding US Silica Holdings or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Calfrac Well Services vs. US Silica Holdings
Performance |
| Timeline |
| Calfrac Well Services |
| US Silica Holdings |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Calfrac Well and US Silica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calfrac Well and US Silica
The main advantage of trading using opposite Calfrac Well and US Silica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calfrac Well position performs unexpectedly, US Silica 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 US Silica will offset losses from the drop in US Silica's long position.| Calfrac Well vs. Vantage Drilling International | Calfrac Well vs. Seadrill Limited | Calfrac Well vs. Noble plc | Calfrac Well vs. Borr Drilling |
| US Silica vs. North American Construction | US Silica vs. ProPetro Holding Corp | US Silica vs. Ranger Energy Services | US Silica vs. Cactus Inc |
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.
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