Correlation Between Civitas Resources and PDC Energy
Can any of the company-specific risk be diversified away by investing in both Civitas Resources and PDC 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 Civitas Resources and PDC Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Civitas Resources and PDC Energy, you can compare the effects of market volatilities on Civitas Resources and PDC 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 Civitas Resources with a short position of PDC Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Civitas Resources and PDC Energy.
Diversification Opportunities for Civitas Resources and PDC Energy
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Civitas and PDC is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Civitas Resources and PDC Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PDC Energy and Civitas Resources 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 Civitas Resources are associated (or correlated) with PDC Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PDC Energy has no effect on the direction of Civitas Resources i.e., Civitas Resources and PDC Energy go up and down completely randomly.
Pair Corralation between Civitas Resources and PDC Energy
If you would invest 5,018 in Civitas Resources on August 24, 2024 and sell it today you would earn a total of 210.00 from holding Civitas Resources or generate 4.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Civitas Resources vs. PDC Energy
Performance |
| Timeline |
| Civitas Resources |
| PDC Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Civitas Resources and PDC Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Civitas Resources and PDC Energy
The main advantage of trading using opposite Civitas Resources and PDC Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Civitas Resources position performs unexpectedly, PDC 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 PDC Energy will offset losses from the drop in PDC Energy's long position.| Civitas Resources vs. Magnolia Oil Gas | Civitas Resources vs. SM Energy Co | Civitas Resources vs. Range Resources Corp | Civitas Resources vs. Matador Resources |
| PDC Energy vs. Devon Energy | PDC Energy vs. Coterra Energy | PDC Energy vs. Diamondback Energy | PDC Energy vs. EOG Resources |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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