Correlation Between Comstock Resources and Berry Petroleum
Can any of the company-specific risk be diversified away by investing in both Comstock Resources and Berry Petroleum 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 Comstock Resources and Berry Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comstock Resources and Berry Petroleum Corp, you can compare the effects of market volatilities on Comstock Resources and Berry Petroleum 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 Comstock Resources with a short position of Berry Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comstock Resources and Berry Petroleum.
Diversification Opportunities for Comstock Resources and Berry Petroleum
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Comstock and Berry is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Comstock Resources and Berry Petroleum Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berry Petroleum Corp and Comstock 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 Comstock Resources are associated (or correlated) with Berry Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berry Petroleum Corp has no effect on the direction of Comstock Resources i.e., Comstock Resources and Berry Petroleum go up and down completely randomly.
Pair Corralation between Comstock Resources and Berry Petroleum
Considering the 90-day investment horizon Comstock Resources is expected to generate 1.07 times more return on investment than Berry Petroleum. However, Comstock Resources is 1.07 times more volatile than Berry Petroleum Corp. It trades about 0.33 of its potential returns per unit of risk. Berry Petroleum Corp is currently generating about -0.21 per unit of risk. If you would invest 1,158 in Comstock Resources on August 24, 2024 and sell it today you would earn a total of 365.00 from holding Comstock Resources or generate 31.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comstock Resources vs. Berry Petroleum Corp
Performance |
| Timeline |
| Comstock Resources |
| Berry Petroleum Corp |
Comstock Resources and Berry Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comstock Resources and Berry Petroleum
The main advantage of trading using opposite Comstock Resources and Berry Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comstock Resources position performs unexpectedly, Berry Petroleum 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 Berry Petroleum will offset losses from the drop in Berry Petroleum's long position.| Comstock Resources vs. Range Resources Corp | Comstock Resources vs. Permian Resources | Comstock Resources vs. EQT Corporation | Comstock Resources vs. Vital Energy |
| Berry Petroleum vs. California Resources Corp | Berry Petroleum vs. Magnolia Oil Gas | Berry Petroleum vs. Comstock Resources | Berry Petroleum vs. Gulfport Energy Operating |
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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