Correlation Between EOG Resources and Ranger Oil
Can any of the company-specific risk be diversified away by investing in both EOG Resources and Ranger Oil 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 EOG Resources and Ranger Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EOG Resources and Ranger Oil Corp, you can compare the effects of market volatilities on EOG Resources and Ranger Oil 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 EOG Resources with a short position of Ranger Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of EOG Resources and Ranger Oil.
Diversification Opportunities for EOG Resources and Ranger Oil
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EOG and Ranger is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding EOG Resources and Ranger Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ranger Oil Corp and EOG Resources 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 EOG Resources are associated (or correlated) with Ranger Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ranger Oil Corp has no effect on the direction of EOG Resources i.e., EOG Resources and Ranger Oil go up and down completely randomly.
Pair Corralation between EOG Resources and Ranger Oil
If you would invest 11,858 in EOG Resources on August 27, 2024 and sell it today you would earn a total of 1,777 from holding EOG Resources or generate 14.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.4% |
| Values | Daily Returns |
EOG Resources vs. Ranger Oil Corp
Performance |
| Timeline |
| EOG Resources |
| Ranger Oil Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
EOG Resources and Ranger Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EOG Resources and Ranger Oil
The main advantage of trading using opposite EOG Resources and Ranger Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EOG Resources position performs unexpectedly, Ranger Oil 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 Ranger Oil will offset losses from the drop in Ranger Oil's long position.| EOG Resources vs. Permian Resources | EOG Resources vs. Devon Energy | EOG Resources vs. Coterra Energy | EOG Resources vs. Marathon Oil |
| Ranger Oil vs. Vermilion Energy | Ranger Oil vs. Canadian Natural Resources | Ranger Oil vs. Matador Resources | Ranger Oil vs. Murphy Oil |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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