Correlation Between Calima Energy and Civitas Resources
Can any of the company-specific risk be diversified away by investing in both Calima Energy 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 Calima Energy and Civitas Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calima Energy Limited and Civitas Resources, you can compare the effects of market volatilities on Calima Energy 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 Calima Energy with a short position of Civitas Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calima Energy and Civitas Resources.
Diversification Opportunities for Calima Energy and Civitas Resources
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Calima and Civitas is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Calima Energy Limited and Civitas Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Civitas Resources and Calima Energy 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 Calima Energy Limited 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 Calima Energy i.e., Calima Energy and Civitas Resources go up and down completely randomly.
Pair Corralation between Calima Energy and Civitas Resources
Assuming the 90 days horizon Calima Energy Limited is expected to generate 1.66 times more return on investment than Civitas Resources. However, Calima Energy is 1.66 times more volatile than Civitas Resources. It trades about 0.06 of its potential returns per unit of risk. Civitas Resources is currently generating about 0.06 per unit of risk. If you would invest 6.00 in Calima Energy Limited on November 3, 2024 and sell it today you would lose (4.75) from holding Calima Energy Limited or give up 79.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Calima Energy Limited vs. Civitas Resources
Performance |
| Timeline |
| Calima Energy Limited |
| Civitas Resources |
Calima Energy and Civitas Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calima Energy and Civitas Resources
The main advantage of trading using opposite Calima Energy and Civitas Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calima Energy 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.| Calima Energy vs. Buru Energy Limited | Calima Energy vs. Altura Energy | Calima Energy vs. Daybreak Oil and | Calima Energy vs. Arrow Exploration Corp |
| Civitas Resources vs. Black Mammoth Metals | Civitas Resources vs. Alvotech | Civitas Resources vs. Vulcan Materials | Civitas Resources vs. Rambler Metals and |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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