Correlation Between Greenfire Resources and Target Hospitality
Can any of the company-specific risk be diversified away by investing in both Greenfire Resources and Target Hospitality 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 Greenfire Resources and Target Hospitality into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greenfire Resources and Target Hospitality Corp, you can compare the effects of market volatilities on Greenfire Resources and Target Hospitality 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 Greenfire Resources with a short position of Target Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenfire Resources and Target Hospitality.
Diversification Opportunities for Greenfire Resources and Target Hospitality
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Greenfire and Target is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Greenfire Resources and Target Hospitality Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Target Hospitality Corp and Greenfire 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 Greenfire Resources are associated (or correlated) with Target Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Target Hospitality Corp has no effect on the direction of Greenfire Resources i.e., Greenfire Resources and Target Hospitality go up and down completely randomly.
Pair Corralation between Greenfire Resources and Target Hospitality
Considering the 90-day investment horizon Greenfire Resources is expected to generate 0.73 times more return on investment than Target Hospitality. However, Greenfire Resources is 1.37 times less risky than Target Hospitality. It trades about 0.04 of its potential returns per unit of risk. Target Hospitality Corp is currently generating about 0.02 per unit of risk. If you would invest 545.00 in Greenfire Resources on November 3, 2024 and sell it today you would earn a total of 93.00 from holding Greenfire Resources or generate 17.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greenfire Resources vs. Target Hospitality Corp
Performance |
| Timeline |
| Greenfire Resources |
| Target Hospitality Corp |
Greenfire Resources and Target Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greenfire Resources and Target Hospitality
The main advantage of trading using opposite Greenfire Resources and Target Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenfire Resources position performs unexpectedly, Target Hospitality 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 Target Hospitality will offset losses from the drop in Target Hospitality's long position.| Greenfire Resources vs. Saia Inc | Greenfire Resources vs. Starwin Media Holdings | Greenfire Resources vs. Playtika Holding Corp | Greenfire Resources vs. National CineMedia |
| Target Hospitality vs. OneSpaWorld Holdings | Target Hospitality vs. KLX Energy Services | Target Hospitality vs. International Money Express | Target Hospitality vs. Concrete Pumping Holdings |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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