Correlation Between Imperial Petroleum and GasLog Partners
Can any of the company-specific risk be diversified away by investing in both Imperial Petroleum and GasLog Partners 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 Imperial Petroleum and GasLog Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imperial Petroleum and GasLog Partners LP, you can compare the effects of market volatilities on Imperial Petroleum and GasLog Partners 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 Imperial Petroleum with a short position of GasLog Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imperial Petroleum and GasLog Partners.
Diversification Opportunities for Imperial Petroleum and GasLog Partners
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Imperial and GasLog is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Imperial Petroleum and GasLog Partners LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GasLog Partners LP and Imperial Petroleum 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 Imperial Petroleum are associated (or correlated) with GasLog Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GasLog Partners LP has no effect on the direction of Imperial Petroleum i.e., Imperial Petroleum and GasLog Partners go up and down completely randomly.
Pair Corralation between Imperial Petroleum and GasLog Partners
Given the investment horizon of 90 days Imperial Petroleum is expected to generate 6.53 times more return on investment than GasLog Partners. However, Imperial Petroleum is 6.53 times more volatile than GasLog Partners LP. It trades about 0.02 of its potential returns per unit of risk. GasLog Partners LP is currently generating about 0.07 per unit of risk. If you would invest 354.00 in Imperial Petroleum on August 27, 2024 and sell it today you would lose (17.00) from holding Imperial Petroleum or give up 4.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Imperial Petroleum vs. GasLog Partners LP
Performance |
| Timeline |
| Imperial Petroleum |
| GasLog Partners LP |
Imperial Petroleum and GasLog Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imperial Petroleum and GasLog Partners
The main advantage of trading using opposite Imperial Petroleum and GasLog Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imperial Petroleum position performs unexpectedly, GasLog Partners 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 GasLog Partners will offset losses from the drop in GasLog Partners' long position.| Imperial Petroleum vs. Western Midstream Partners | Imperial Petroleum vs. DT Midstream | Imperial Petroleum vs. MPLX LP | Imperial Petroleum vs. BP Prudhoe Bay |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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