Correlation Between Cardinal Energy and California Resources
Can any of the company-specific risk be diversified away by investing in both Cardinal Energy and California 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 Cardinal Energy and California Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardinal Energy and California Resources, you can compare the effects of market volatilities on Cardinal Energy and California 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 Cardinal Energy with a short position of California Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Energy and California Resources.
Diversification Opportunities for Cardinal Energy and California Resources
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cardinal and California is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Energy and California Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on California Resources and Cardinal 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 Cardinal Energy are associated (or correlated) with California Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of California Resources has no effect on the direction of Cardinal Energy i.e., Cardinal Energy and California Resources go up and down completely randomly.
Pair Corralation between Cardinal Energy and California Resources
If you would invest 453.00 in Cardinal Energy on September 2, 2024 and sell it today you would earn a total of 18.00 from holding Cardinal Energy or generate 3.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Cardinal Energy vs. California Resources
Performance |
| Timeline |
| Cardinal Energy |
| California Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Cardinal Energy and California Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Energy and California Resources
The main advantage of trading using opposite Cardinal Energy and California Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Energy position performs unexpectedly, California 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 California Resources will offset losses from the drop in California Resources' long position.| Cardinal Energy vs. Tamarack Valley Energy | Cardinal Energy vs. Pine Cliff Energy | Cardinal Energy vs. MEG Energy Corp | Cardinal Energy vs. Headwater Exploration |
| California Resources vs. Cardinal Energy | California Resources vs. Spartan Delta Corp | California Resources vs. Delek Group | California Resources vs. Bonterra Energy Corp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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