Correlation Between Chevron and Hellenic Petroleum
Can any of the company-specific risk be diversified away by investing in both Chevron and Hellenic Petroleum 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 Chevron and Hellenic Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chevron and Hellenic Petroleum SA, you can compare the effects of market volatilities on Chevron and Hellenic Petroleum 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 Chevron with a short position of Hellenic Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chevron and Hellenic Petroleum.
Diversification Opportunities for Chevron and Hellenic Petroleum
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Chevron and Hellenic is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Chevron and Hellenic Petroleum SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hellenic Petroleum and Chevron 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 Chevron are associated (or correlated) with Hellenic Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hellenic Petroleum has no effect on the direction of Chevron i.e., Chevron and Hellenic Petroleum go up and down completely randomly.
Pair Corralation between Chevron and Hellenic Petroleum
Assuming the 90 days horizon Chevron is expected to generate 0.96 times more return on investment than Hellenic Petroleum. However, Chevron is 1.04 times less risky than Hellenic Petroleum. It trades about 0.3 of its potential returns per unit of risk. Hellenic Petroleum SA is currently generating about -0.09 per unit of risk. If you would invest 13,059 in Chevron on August 30, 2024 and sell it today you would earn a total of 2,369 from holding Chevron or generate 18.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chevron vs. Hellenic Petroleum SA
Performance |
| Timeline |
| Chevron |
| Hellenic Petroleum |
Chevron and Hellenic Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chevron and Hellenic Petroleum
The main advantage of trading using opposite Chevron and Hellenic Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chevron position performs unexpectedly, Hellenic Petroleum 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 Hellenic Petroleum will offset losses from the drop in Hellenic Petroleum's long position.| Chevron vs. CVR Medical Corp | Chevron vs. SOFI TECHNOLOGIES | Chevron vs. ASPEN TECHINC DL | Chevron vs. Fevertree Drinks PLC |
| Hellenic Petroleum vs. MICRONIC MYDATA | Hellenic Petroleum vs. Darden Restaurants | Hellenic Petroleum vs. DATAGROUP SE | Hellenic Petroleum vs. DICKER DATA LTD |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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