Correlation Between 88 Energy and Eco (Atlantic)
Can any of the company-specific risk be diversified away by investing in both 88 Energy and Eco (Atlantic) 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 88 Energy and Eco (Atlantic) into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 88 Energy Limited and Eco Oil Gas, you can compare the effects of market volatilities on 88 Energy and Eco (Atlantic) 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 88 Energy with a short position of Eco (Atlantic). Check out your portfolio center. Please also check ongoing floating volatility patterns of 88 Energy and Eco (Atlantic).
Diversification Opportunities for 88 Energy and Eco (Atlantic)
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between EEENF and Eco is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding 88 Energy Limited and Eco Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eco (Atlantic) and 88 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 88 Energy Limited are associated (or correlated) with Eco (Atlantic). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eco (Atlantic) has no effect on the direction of 88 Energy i.e., 88 Energy and Eco (Atlantic) go up and down completely randomly.
Pair Corralation between 88 Energy and Eco (Atlantic)
Assuming the 90 days horizon 88 Energy Limited is expected to under-perform the Eco (Atlantic). But the pink sheet apears to be less risky and, when comparing its historical volatility, 88 Energy Limited is 1.57 times less risky than Eco (Atlantic). The pink sheet trades about -0.02 of its potential returns per unit of risk. The Eco Oil Gas is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Eco Oil Gas on October 23, 2024 and sell it today you would earn a total of 4.00 from holding Eco Oil Gas or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
88 Energy Limited vs. Eco Oil Gas
Performance |
| Timeline |
| 88 Energy Limited |
| Eco (Atlantic) |
88 Energy and Eco (Atlantic) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 88 Energy and Eco (Atlantic)
The main advantage of trading using opposite 88 Energy and Eco (Atlantic) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 88 Energy position performs unexpectedly, Eco (Atlantic) 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 Eco (Atlantic) will offset losses from the drop in Eco (Atlantic)'s long position.| 88 Energy vs. Invictus Energy Limited | 88 Energy vs. Sintana Energy | 88 Energy vs. Journey Energy | 88 Energy vs. Trillion Energy International |
| Eco (Atlantic) vs. CGX Energy | Eco (Atlantic) vs. Frontera Energy Corp | Eco (Atlantic) vs. Africa Energy Corp | Eco (Atlantic) vs. Africa Oil 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |