Correlation Between Empire Petroleum and TotalEnergies
Can any of the company-specific risk be diversified away by investing in both Empire Petroleum and TotalEnergies 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 Empire Petroleum and TotalEnergies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Empire Petroleum Corp and TotalEnergies SE ADR, you can compare the effects of market volatilities on Empire Petroleum and TotalEnergies 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 Empire Petroleum with a short position of TotalEnergies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire Petroleum and TotalEnergies.
Diversification Opportunities for Empire Petroleum and TotalEnergies
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Empire and TotalEnergies is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Empire Petroleum Corp and TotalEnergies SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TotalEnergies SE ADR and Empire Petroleum 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 Empire Petroleum Corp are associated (or correlated) with TotalEnergies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TotalEnergies SE ADR has no effect on the direction of Empire Petroleum i.e., Empire Petroleum and TotalEnergies go up and down completely randomly.
Pair Corralation between Empire Petroleum and TotalEnergies
Allowing for the 90-day total investment horizon Empire Petroleum Corp is expected to under-perform the TotalEnergies. In addition to that, Empire Petroleum is 3.07 times more volatile than TotalEnergies SE ADR. It trades about -0.01 of its total potential returns per unit of risk. TotalEnergies SE ADR is currently generating about 0.02 per unit of volatility. If you would invest 5,322 in TotalEnergies SE ADR on August 30, 2024 and sell it today you would earn a total of 394.00 from holding TotalEnergies SE ADR or generate 7.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Empire Petroleum Corp vs. TotalEnergies SE ADR
Performance |
| Timeline |
| Empire Petroleum Corp |
| TotalEnergies SE ADR |
Empire Petroleum and TotalEnergies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empire Petroleum and TotalEnergies
The main advantage of trading using opposite Empire Petroleum and TotalEnergies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empire Petroleum position performs unexpectedly, TotalEnergies 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 TotalEnergies will offset losses from the drop in TotalEnergies' long position.| Empire Petroleum vs. PHX Minerals | Empire Petroleum vs. Mexco Energy | Empire Petroleum vs. Granite Ridge Resources | Empire Petroleum vs. XXL Energy Corp |
| TotalEnergies vs. Chevron Corp | TotalEnergies vs. Merck Company | TotalEnergies vs. Pharvaris BV | TotalEnergies vs. Brinker International |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |