Correlation Between InPlay Oil and Triple Flag
Can any of the company-specific risk be diversified away by investing in both InPlay Oil and Triple Flag 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 InPlay Oil and Triple Flag into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InPlay Oil Corp and Triple Flag Precious, you can compare the effects of market volatilities on InPlay Oil and Triple Flag 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 InPlay Oil with a short position of Triple Flag. Check out your portfolio center. Please also check ongoing floating volatility patterns of InPlay Oil and Triple Flag.
Diversification Opportunities for InPlay Oil and Triple Flag
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between InPlay and Triple is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding InPlay Oil Corp and Triple Flag Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triple Flag Precious and InPlay Oil 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 InPlay Oil Corp are associated (or correlated) with Triple Flag. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triple Flag Precious has no effect on the direction of InPlay Oil i.e., InPlay Oil and Triple Flag go up and down completely randomly.
Pair Corralation between InPlay Oil and Triple Flag
Assuming the 90 days trading horizon InPlay Oil Corp is expected to under-perform the Triple Flag. But the stock apears to be less risky and, when comparing its historical volatility, InPlay Oil Corp is 1.0 times less risky than Triple Flag. The stock trades about -0.22 of its potential returns per unit of risk. The Triple Flag Precious is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 2,182 in Triple Flag Precious on November 5, 2024 and sell it today you would earn a total of 142.00 from holding Triple Flag Precious or generate 6.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
InPlay Oil Corp vs. Triple Flag Precious
Performance |
| Timeline |
| InPlay Oil Corp |
| Triple Flag Precious |
InPlay Oil and Triple Flag Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InPlay Oil and Triple Flag
The main advantage of trading using opposite InPlay Oil and Triple Flag positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InPlay Oil position performs unexpectedly, Triple Flag 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 Triple Flag will offset losses from the drop in Triple Flag's long position.| InPlay Oil vs. Prairie Provident Resources | InPlay Oil vs. Pine Cliff Energy | InPlay Oil vs. Southern Energy Corp | InPlay Oil vs. iShares Canadian HYBrid |
| Triple Flag vs. Western Investment | Triple Flag vs. Pembina Pipeline Corp | Triple Flag vs. Solid Impact Investments | Triple Flag vs. Champion Iron |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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