Correlation Between Foothills Exploration and Petro Viking
Can any of the company-specific risk be diversified away by investing in both Foothills Exploration and Petro Viking 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 Foothills Exploration and Petro Viking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Foothills Exploration and Petro Viking Energy, you can compare the effects of market volatilities on Foothills Exploration and Petro Viking 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 Foothills Exploration with a short position of Petro Viking. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foothills Exploration and Petro Viking.
Diversification Opportunities for Foothills Exploration and Petro Viking
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Foothills and Petro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Foothills Exploration and Petro Viking Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petro Viking Energy and Foothills Exploration 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 Foothills Exploration are associated (or correlated) with Petro Viking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petro Viking Energy has no effect on the direction of Foothills Exploration i.e., Foothills Exploration and Petro Viking go up and down completely randomly.
Pair Corralation between Foothills Exploration and Petro Viking
Given the investment horizon of 90 days Foothills Exploration is expected to generate 1.57 times less return on investment than Petro Viking. But when comparing it to its historical volatility, Foothills Exploration is 2.1 times less risky than Petro Viking. It trades about 0.12 of its potential returns per unit of risk. Petro Viking Energy is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 23.00 in Petro Viking Energy on August 30, 2024 and sell it today you would lose (21.81) from holding Petro Viking Energy or give up 94.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Foothills Exploration vs. Petro Viking Energy
Performance |
| Timeline |
| Foothills Exploration |
| Petro Viking Energy |
Foothills Exploration and Petro Viking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Foothills Exploration and Petro Viking
The main advantage of trading using opposite Foothills Exploration and Petro Viking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foothills Exploration position performs unexpectedly, Petro Viking 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 Petro Viking will offset losses from the drop in Petro Viking's long position.| Foothills Exploration vs. Permian Resources | Foothills Exploration vs. Devon Energy | Foothills Exploration vs. EOG Resources | Foothills Exploration vs. Coterra Energy |
| Petro Viking vs. Otto Energy Limited | Petro Viking vs. Foothills Exploration | Petro Viking vs. MMEX Resources Corp | Petro Viking vs. 1st NRG 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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