Correlation Between CNX Resources and Pantheon Resources
Can any of the company-specific risk be diversified away by investing in both CNX Resources and Pantheon 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 CNX Resources and Pantheon Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNX Resources Corp and Pantheon Resources Plc, you can compare the effects of market volatilities on CNX Resources and Pantheon 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 CNX Resources with a short position of Pantheon Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNX Resources and Pantheon Resources.
Diversification Opportunities for CNX Resources and Pantheon Resources
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CNX and Pantheon is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding CNX Resources Corp and Pantheon Resources Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pantheon Resources Plc and CNX 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 CNX Resources Corp are associated (or correlated) with Pantheon Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pantheon Resources Plc has no effect on the direction of CNX Resources i.e., CNX Resources and Pantheon Resources go up and down completely randomly.
Pair Corralation between CNX Resources and Pantheon Resources
Considering the 90-day investment horizon CNX Resources Corp is expected to generate 0.34 times more return on investment than Pantheon Resources. However, CNX Resources Corp is 2.94 times less risky than Pantheon Resources. It trades about 0.17 of its potential returns per unit of risk. Pantheon Resources Plc is currently generating about 0.05 per unit of risk. If you would invest 1,983 in CNX Resources Corp on September 4, 2024 and sell it today you would earn a total of 1,964 from holding CNX Resources Corp or generate 99.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
CNX Resources Corp vs. Pantheon Resources Plc
Performance |
| Timeline |
| CNX Resources Corp |
| Pantheon Resources Plc |
CNX Resources and Pantheon Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNX Resources and Pantheon Resources
The main advantage of trading using opposite CNX Resources and Pantheon Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNX Resources position performs unexpectedly, Pantheon 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 Pantheon Resources will offset losses from the drop in Pantheon Resources' long position.| CNX Resources vs. Evolution Petroleum | CNX Resources vs. Ring Energy | CNX Resources vs. Gran Tierra Energy | CNX Resources vs. PEDEVCO Corp |
| Pantheon Resources vs. CNX Resources Corp | Pantheon Resources vs. MV Oil Trust | Pantheon Resources vs. San Juan Basin | Pantheon Resources vs. VOC Energy Trust |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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