Correlation Between Coterra Energy and Mogul Energy
Can any of the company-specific risk be diversified away by investing in both Coterra Energy and Mogul 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 Coterra Energy and Mogul Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coterra Energy and Mogul Energy International, you can compare the effects of market volatilities on Coterra Energy and Mogul 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 Coterra Energy with a short position of Mogul Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coterra Energy and Mogul Energy.
Diversification Opportunities for Coterra Energy and Mogul Energy
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Coterra and Mogul is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Coterra Energy and Mogul Energy International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mogul Energy Interna and Coterra 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 Coterra Energy are associated (or correlated) with Mogul Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mogul Energy Interna has no effect on the direction of Coterra Energy i.e., Coterra Energy and Mogul Energy go up and down completely randomly.
Pair Corralation between Coterra Energy and Mogul Energy
Given the investment horizon of 90 days Coterra Energy is expected to generate 0.14 times more return on investment than Mogul Energy. However, Coterra Energy is 7.34 times less risky than Mogul Energy. It trades about 0.03 of its potential returns per unit of risk. Mogul Energy International is currently generating about -0.03 per unit of risk. If you would invest 2,520 in Coterra Energy on September 12, 2024 and sell it today you would earn a total of 16.00 from holding Coterra Energy or generate 0.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coterra Energy vs. Mogul Energy International
Performance |
| Timeline |
| Coterra Energy |
| Mogul Energy Interna |
Coterra Energy and Mogul Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coterra Energy and Mogul Energy
The main advantage of trading using opposite Coterra Energy and Mogul Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coterra Energy position performs unexpectedly, Mogul 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 Mogul Energy will offset losses from the drop in Mogul Energy's long position.| Coterra Energy vs. Devon Energy | Coterra Energy vs. Diamondback Energy | Coterra Energy vs. EOG Resources | Coterra Energy vs. ConocoPhillips |
| Mogul Energy vs. Permian Resources | Mogul Energy vs. Devon Energy | Mogul Energy vs. EOG Resources | Mogul Energy vs. Coterra 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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