Correlation Between Inpex Corp and Woodside Energy
Can any of the company-specific risk be diversified away by investing in both Inpex Corp and Woodside Energy 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 Inpex Corp and Woodside Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inpex Corp ADR and Woodside Energy Group, you can compare the effects of market volatilities on Inpex Corp and Woodside Energy 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 Inpex Corp with a short position of Woodside Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inpex Corp and Woodside Energy.
Diversification Opportunities for Inpex Corp and Woodside Energy
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Inpex and Woodside is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Inpex Corp ADR and Woodside Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woodside Energy Group and Inpex Corp 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 Inpex Corp ADR are associated (or correlated) with Woodside Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woodside Energy Group has no effect on the direction of Inpex Corp i.e., Inpex Corp and Woodside Energy go up and down completely randomly.
Pair Corralation between Inpex Corp and Woodside Energy
Assuming the 90 days horizon Inpex Corp ADR is expected to under-perform the Woodside Energy. In addition to that, Inpex Corp is 1.07 times more volatile than Woodside Energy Group. It trades about -0.16 of its total potential returns per unit of risk. Woodside Energy Group is currently generating about -0.02 per unit of volatility. If you would invest 1,570 in Woodside Energy Group on November 3, 2024 and sell it today you would lose (14.00) from holding Woodside Energy Group or give up 0.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inpex Corp ADR vs. Woodside Energy Group
Performance |
| Timeline |
| Inpex Corp ADR |
| Woodside Energy Group |
Inpex Corp and Woodside Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inpex Corp and Woodside Energy
The main advantage of trading using opposite Inpex Corp and Woodside Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inpex Corp position performs unexpectedly, Woodside Energy 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 Woodside Energy will offset losses from the drop in Woodside Energy's long position.| Inpex Corp vs. San Leon Energy | Inpex Corp vs. Enwell Energy plc | Inpex Corp vs. Dno ASA | Inpex Corp vs. Questerre Energy |
| Woodside Energy vs. EOG Resources | Woodside Energy vs. APA Corporation | Woodside Energy vs. Range Resources Corp | Woodside Energy vs. Diamondback 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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