Correlation Between Callon Petroleum and Ovintiv
Can any of the company-specific risk be diversified away by investing in both Callon Petroleum and Ovintiv 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 Callon Petroleum and Ovintiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Callon Petroleum and Ovintiv, you can compare the effects of market volatilities on Callon Petroleum and Ovintiv 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 Callon Petroleum with a short position of Ovintiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Callon Petroleum and Ovintiv.
Diversification Opportunities for Callon Petroleum and Ovintiv
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Callon and Ovintiv is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Callon Petroleum and Ovintiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ovintiv and Callon Petroleum 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 Callon Petroleum are associated (or correlated) with Ovintiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ovintiv has no effect on the direction of Callon Petroleum i.e., Callon Petroleum and Ovintiv go up and down completely randomly.
Pair Corralation between Callon Petroleum and Ovintiv
If you would invest 3,941 in Ovintiv on November 9, 2024 and sell it today you would earn a total of 293.00 from holding Ovintiv or generate 7.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Callon Petroleum vs. Ovintiv
Performance |
| Timeline |
| Callon Petroleum |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Ovintiv |
Callon Petroleum and Ovintiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Callon Petroleum and Ovintiv
The main advantage of trading using opposite Callon Petroleum and Ovintiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Callon Petroleum position performs unexpectedly, Ovintiv 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 Ovintiv will offset losses from the drop in Ovintiv's long position.| Callon Petroleum vs. SandRidge Energy | Callon Petroleum vs. Permian Resources | Callon Petroleum vs. Matador Resources | Callon Petroleum vs. Antero Resources Corp |
| Ovintiv vs. Gran Tierra Energy | Ovintiv vs. Permian Resources | Ovintiv vs. PermRock Royalty Trust | Ovintiv vs. MV Oil 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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