Correlation Between Coterra Energy and New Frontier
Can any of the company-specific risk be diversified away by investing in both Coterra Energy and New Frontier 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 New Frontier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coterra Energy and New Frontier Energy, you can compare the effects of market volatilities on Coterra Energy and New Frontier 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 New Frontier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coterra Energy and New Frontier.
Diversification Opportunities for Coterra Energy and New Frontier
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coterra and New is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Coterra Energy and New Frontier Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Frontier Energy 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 New Frontier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Frontier Energy has no effect on the direction of Coterra Energy i.e., Coterra Energy and New Frontier go up and down completely randomly.
Pair Corralation between Coterra Energy and New Frontier
If you would invest 2,413 in Coterra Energy on August 30, 2024 and sell it today you would earn a total of 255.00 from holding Coterra Energy or generate 10.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coterra Energy vs. New Frontier Energy
Performance |
| Timeline |
| Coterra Energy |
| New Frontier Energy |
Coterra Energy and New Frontier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coterra Energy and New Frontier
The main advantage of trading using opposite Coterra Energy and New Frontier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coterra Energy position performs unexpectedly, New Frontier 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 New Frontier will offset losses from the drop in New Frontier's long position.| Coterra Energy vs. Devon Energy | Coterra Energy vs. Diamondback Energy | Coterra Energy vs. EOG Resources | Coterra Energy vs. ConocoPhillips |
| New Frontier vs. Barrel Energy | New Frontier vs. Gulfport Energy Operating | New Frontier vs. Magnolia Oil Gas | New Frontier vs. Vital 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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