Correlation Between Crescent Energy and Chesapeake Energy
Can any of the company-specific risk be diversified away by investing in both Crescent Energy and Chesapeake Energy 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 Crescent Energy and Chesapeake Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crescent Energy Co and Chesapeake Energy, you can compare the effects of market volatilities on Crescent Energy and Chesapeake Energy 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 Crescent Energy with a short position of Chesapeake Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crescent Energy and Chesapeake Energy.
Diversification Opportunities for Crescent Energy and Chesapeake Energy
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Crescent and Chesapeake is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Crescent Energy Co and Chesapeake Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chesapeake Energy and Crescent 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 Crescent Energy Co are associated (or correlated) with Chesapeake Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chesapeake Energy has no effect on the direction of Crescent Energy i.e., Crescent Energy and Chesapeake Energy go up and down completely randomly.
Pair Corralation between Crescent Energy and Chesapeake Energy
If you would invest 1,245 in Crescent Energy Co on August 26, 2024 and sell it today you would earn a total of 283.00 from holding Crescent Energy Co or generate 22.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Crescent Energy Co vs. Chesapeake Energy
Performance |
| Timeline |
| Crescent Energy |
| Chesapeake Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Strong
Crescent Energy and Chesapeake Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crescent Energy and Chesapeake Energy
The main advantage of trading using opposite Crescent Energy and Chesapeake Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crescent Energy position performs unexpectedly, Chesapeake Energy 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 Chesapeake Energy will offset losses from the drop in Chesapeake Energy's long position.| Crescent Energy vs. Vital Energy | Crescent Energy vs. Permian Resources | Crescent Energy vs. Magnolia Oil Gas | Crescent Energy vs. Ring Energy |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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