Correlation Between TechnipFMC PLC and US Silica
Can any of the company-specific risk be diversified away by investing in both TechnipFMC PLC and US Silica 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 TechnipFMC PLC and US Silica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TechnipFMC PLC and US Silica Holdings, you can compare the effects of market volatilities on TechnipFMC PLC and US Silica 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 TechnipFMC PLC with a short position of US Silica. Check out your portfolio center. Please also check ongoing floating volatility patterns of TechnipFMC PLC and US Silica.
Diversification Opportunities for TechnipFMC PLC and US Silica
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between TechnipFMC and SLCA is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding TechnipFMC PLC and US Silica Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Silica Holdings and TechnipFMC PLC 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 TechnipFMC PLC are associated (or correlated) with US Silica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Silica Holdings has no effect on the direction of TechnipFMC PLC i.e., TechnipFMC PLC and US Silica go up and down completely randomly.
Pair Corralation between TechnipFMC PLC and US Silica
Considering the 90-day investment horizon TechnipFMC PLC is expected to generate 0.41 times more return on investment than US Silica. However, TechnipFMC PLC is 2.46 times less risky than US Silica. It trades about 0.1 of its potential returns per unit of risk. US Silica Holdings is currently generating about -0.03 per unit of risk. If you would invest 1,130 in TechnipFMC PLC on September 2, 2024 and sell it today you would earn a total of 2,007 from holding TechnipFMC PLC or generate 177.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 82.86% |
| Values | Daily Returns |
TechnipFMC PLC vs. US Silica Holdings
Performance |
| Timeline |
| TechnipFMC PLC |
| US Silica Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
TechnipFMC PLC and US Silica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TechnipFMC PLC and US Silica
The main advantage of trading using opposite TechnipFMC PLC and US Silica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TechnipFMC PLC position performs unexpectedly, US Silica 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 US Silica will offset losses from the drop in US Silica's long position.| TechnipFMC PLC vs. Oceaneering International | TechnipFMC PLC vs. NOV Inc | TechnipFMC PLC vs. Flowserve | TechnipFMC PLC vs. Core Laboratories NV |
| US Silica vs. Newpark Resources | US Silica vs. North American Construction | US Silica vs. ProPetro Holding Corp | US Silica vs. Ranger Energy Services |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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