Correlation Between Expand Energy and Western Alaska
Can any of the company-specific risk be diversified away by investing in both Expand Energy and Western Alaska 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 Expand Energy and Western Alaska into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expand Energy and Western Alaska Minerals, you can compare the effects of market volatilities on Expand Energy and Western Alaska 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 Expand Energy with a short position of Western Alaska. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expand Energy and Western Alaska.
Diversification Opportunities for Expand Energy and Western Alaska
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Expand and Western is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Expand Energy and Western Alaska Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Alaska Minerals and Expand 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 Expand Energy are associated (or correlated) with Western Alaska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Alaska Minerals has no effect on the direction of Expand Energy i.e., Expand Energy and Western Alaska go up and down completely randomly.
Pair Corralation between Expand Energy and Western Alaska
Assuming the 90 days horizon Expand Energy is expected to generate 0.23 times more return on investment than Western Alaska. However, Expand Energy is 4.3 times less risky than Western Alaska. It trades about 0.38 of its potential returns per unit of risk. Western Alaska Minerals is currently generating about 0.06 per unit of risk. If you would invest 8,963 in Expand Energy on October 24, 2024 and sell it today you would earn a total of 1,169 from holding Expand Energy or generate 13.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Expand Energy vs. Western Alaska Minerals
Performance |
| Timeline |
| Expand Energy |
| Western Alaska Minerals |
Expand Energy and Western Alaska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expand Energy and Western Alaska
The main advantage of trading using opposite Expand Energy and Western Alaska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expand Energy position performs unexpectedly, Western Alaska 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 Western Alaska will offset losses from the drop in Western Alaska's long position.| Expand Energy vs. NETGEAR | Expand Energy vs. IPG Photonics | Expand Energy vs. Yuexiu Transport Infrastructure | Expand Energy vs. United Microelectronics |
| Western Alaska vs. First Tellurium Corp | Western Alaska vs. Max Resource Corp | Western Alaska vs. P2 Gold | Western Alaska vs. CMC Metals |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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