Correlation Between CKX Lands and Matador Resources
Can any of the company-specific risk be diversified away by investing in both CKX Lands and Matador 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 Matador 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 Matador Resources, you can compare the effects of market volatilities on CKX Lands and Matador 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 Matador Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of CKX Lands and Matador Resources.
Diversification Opportunities for CKX Lands and Matador Resources
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CKX and Matador is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding CKX Lands and Matador Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matador 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 Matador Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matador Resources has no effect on the direction of CKX Lands i.e., CKX Lands and Matador Resources go up and down completely randomly.
Pair Corralation between CKX Lands and Matador Resources
Considering the 90-day investment horizon CKX Lands is expected to generate 20.19 times more return on investment than Matador Resources. However, CKX Lands is 20.19 times more volatile than Matador Resources. It trades about 0.04 of its potential returns per unit of risk. Matador Resources is currently generating about 0.01 per unit of risk. If you would invest 970.00 in CKX Lands on November 9, 2024 and sell it today you would earn a total of 160.00 from holding CKX Lands or generate 16.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.1% |
| Values | Daily Returns |
CKX Lands vs. Matador Resources
Performance |
| Timeline |
| CKX Lands |
| Matador Resources |
CKX Lands and Matador Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CKX Lands and Matador Resources
The main advantage of trading using opposite CKX Lands and Matador Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CKX Lands position performs unexpectedly, Matador 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 Matador Resources will offset losses from the drop in Matador 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 |
| Matador Resources vs. Murphy Oil | Matador Resources vs. Civitas Resources | Matador Resources vs. Permian Resources | Matador Resources vs. Antero Resources Corp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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