Correlation Between Chevron Corp and Patterson
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By analyzing existing cross correlation between Chevron Corp and Patterson UTI Energy 515, you can compare the effects of market volatilities on Chevron Corp and Patterson 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 Chevron Corp with a short position of Patterson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chevron Corp and Patterson.
Diversification Opportunities for Chevron Corp and Patterson
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Chevron and Patterson is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Chevron Corp and Patterson UTI Energy 515 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Patterson UTI Energy and Chevron Corp 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 Chevron Corp are associated (or correlated) with Patterson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Patterson UTI Energy has no effect on the direction of Chevron Corp i.e., Chevron Corp and Patterson go up and down completely randomly.
Pair Corralation between Chevron Corp and Patterson
Considering the 90-day investment horizon Chevron Corp is expected to generate 1.75 times more return on investment than Patterson. However, Chevron Corp is 1.75 times more volatile than Patterson UTI Energy 515. It trades about 0.38 of its potential returns per unit of risk. Patterson UTI Energy 515 is currently generating about 0.01 per unit of risk. If you would invest 14,702 in Chevron Corp on August 30, 2024 and sell it today you would earn a total of 1,509 from holding Chevron Corp or generate 10.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Chevron Corp vs. Patterson UTI Energy 515
Performance |
| Timeline |
| Chevron Corp |
| Patterson UTI Energy |
Chevron Corp and Patterson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chevron Corp and Patterson
The main advantage of trading using opposite Chevron Corp and Patterson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chevron Corp position performs unexpectedly, Patterson 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 Patterson will offset losses from the drop in Patterson's long position.| Chevron Corp vs. BP PLC ADR | Chevron Corp vs. Shell PLC ADR | Chevron Corp vs. Petroleo Brasileiro Petrobras | Chevron Corp vs. Suncor Energy |
| Patterson vs. Eldorado Gold Corp | Patterson vs. Li Auto | Patterson vs. BRP Inc | Patterson vs. CECO Environmental 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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