Correlation Between Hillcrest Energy and Surge Battery
Can any of the company-specific risk be diversified away by investing in both Hillcrest Energy and Surge Battery 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 Hillcrest Energy and Surge Battery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hillcrest Energy Technologies and Surge Battery Metals, you can compare the effects of market volatilities on Hillcrest Energy and Surge Battery 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 Hillcrest Energy with a short position of Surge Battery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hillcrest Energy and Surge Battery.
Diversification Opportunities for Hillcrest Energy and Surge Battery
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hillcrest and Surge is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Hillcrest Energy Technologies and Surge Battery Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surge Battery Metals and Hillcrest 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 Hillcrest Energy Technologies are associated (or correlated) with Surge Battery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surge Battery Metals has no effect on the direction of Hillcrest Energy i.e., Hillcrest Energy and Surge Battery go up and down completely randomly.
Pair Corralation between Hillcrest Energy and Surge Battery
Assuming the 90 days horizon Hillcrest Energy Technologies is expected to generate 1.22 times more return on investment than Surge Battery. However, Hillcrest Energy is 1.22 times more volatile than Surge Battery Metals. It trades about -0.09 of its potential returns per unit of risk. Surge Battery Metals is currently generating about -0.31 per unit of risk. If you would invest 16.00 in Hillcrest Energy Technologies on August 28, 2024 and sell it today you would lose (2.00) from holding Hillcrest Energy Technologies or give up 12.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Hillcrest Energy Technologies vs. Surge Battery Metals
Performance |
| Timeline |
| Hillcrest Energy Tec |
| Surge Battery Metals |
Hillcrest Energy and Surge Battery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hillcrest Energy and Surge Battery
The main advantage of trading using opposite Hillcrest Energy and Surge Battery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hillcrest Energy position performs unexpectedly, Surge Battery 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 Surge Battery will offset losses from the drop in Surge Battery's long position.| Hillcrest Energy vs. Permian Resources | Hillcrest Energy vs. Devon Energy | Hillcrest Energy vs. EOG Resources | Hillcrest Energy vs. Coterra Energy |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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