Correlation Between Excelerate Energy and Adams Resources
Can any of the company-specific risk be diversified away by investing in both Excelerate Energy and Adams 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 Excelerate Energy and Adams Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excelerate Energy and Adams Resources Energy, you can compare the effects of market volatilities on Excelerate Energy and Adams 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 Excelerate Energy with a short position of Adams Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excelerate Energy and Adams Resources.
Diversification Opportunities for Excelerate Energy and Adams Resources
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Excelerate and Adams is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Excelerate Energy and Adams Resources Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adams Resources Energy and Excelerate 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 Excelerate Energy are associated (or correlated) with Adams Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adams Resources Energy has no effect on the direction of Excelerate Energy i.e., Excelerate Energy and Adams Resources go up and down completely randomly.
Pair Corralation between Excelerate Energy and Adams Resources
Allowing for the 90-day total investment horizon Excelerate Energy is expected to generate 0.86 times more return on investment than Adams Resources. However, Excelerate Energy is 1.17 times less risky than Adams Resources. It trades about 0.02 of its potential returns per unit of risk. Adams Resources Energy is currently generating about 0.02 per unit of risk. If you would invest 2,745 in Excelerate Energy on August 24, 2024 and sell it today you would earn a total of 297.00 from holding Excelerate Energy or generate 10.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Excelerate Energy vs. Adams Resources Energy
Performance |
| Timeline |
| Excelerate Energy |
| Adams Resources Energy |
Excelerate Energy and Adams Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excelerate Energy and Adams Resources
The main advantage of trading using opposite Excelerate Energy and Adams Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excelerate Energy position performs unexpectedly, Adams 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 Adams Resources will offset losses from the drop in Adams Resources' long position.| Excelerate Energy vs. Atlantica Sustainable Infrastructure | Excelerate Energy vs. Clearway Energy | Excelerate Energy vs. Brookfield Renewable Corp | Excelerate Energy vs. Nextera Energy Partners |
| Adams Resources vs. PrimeEnergy | Adams Resources vs. Barnwell Industries | Adams Resources vs. Acme United | Adams Resources vs. CKX Lands |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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