Correlation Between CKX Lands and Civitas Resources
Can any of the company-specific risk be diversified away by investing in both CKX Lands and Civitas Resources 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 CKX Lands and Civitas Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CKX Lands and Civitas Resources, you can compare the effects of market volatilities on CKX Lands and Civitas Resources 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 CKX Lands with a short position of Civitas Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of CKX Lands and Civitas Resources.
Diversification Opportunities for CKX Lands and Civitas Resources
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CKX and Civitas is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding CKX Lands and Civitas Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Civitas Resources and CKX Lands 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 CKX Lands are associated (or correlated) with Civitas Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Civitas Resources has no effect on the direction of CKX Lands i.e., CKX Lands and Civitas Resources go up and down completely randomly.
Pair Corralation between CKX Lands and Civitas Resources
Considering the 90-day investment horizon CKX Lands is expected to under-perform the Civitas Resources. But the stock apears to be less risky and, when comparing its historical volatility, CKX Lands is 1.26 times less risky than Civitas Resources. The stock trades about -0.26 of its potential returns per unit of risk. The Civitas Resources is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 4,770 in Civitas Resources on November 3, 2024 and sell it today you would earn a total of 306.00 from holding Civitas Resources or generate 6.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CKX Lands vs. Civitas Resources
Performance |
| Timeline |
| CKX Lands |
| Civitas Resources |
CKX Lands and Civitas Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CKX Lands and Civitas Resources
The main advantage of trading using opposite CKX Lands and Civitas Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CKX Lands position performs unexpectedly, Civitas Resources 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 Civitas Resources will offset losses from the drop in Civitas Resources' long position.| CKX Lands vs. PrimeEnergy | CKX Lands vs. MorningStar Partners, LP | CKX Lands vs. XXL Energy Corp | CKX Lands vs. Magnolia Oil Gas |
| Civitas Resources vs. Magnolia Oil Gas | Civitas Resources vs. SM Energy Co | Civitas Resources vs. Range Resources Corp | Civitas Resources vs. Matador 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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