Correlation Between Invictus Energy and Gulfport Energy
Can any of the company-specific risk be diversified away by investing in both Invictus Energy and Gulfport 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 Invictus Energy and Gulfport Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invictus Energy Limited and Gulfport Energy Operating, you can compare the effects of market volatilities on Invictus Energy and Gulfport 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 Invictus Energy with a short position of Gulfport Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invictus Energy and Gulfport Energy.
Diversification Opportunities for Invictus Energy and Gulfport Energy
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Invictus and Gulfport is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Invictus Energy Limited and Gulfport Energy Operating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gulfport Energy Operating and Invictus 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 Invictus Energy Limited are associated (or correlated) with Gulfport Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gulfport Energy Operating has no effect on the direction of Invictus Energy i.e., Invictus Energy and Gulfport Energy go up and down completely randomly.
Pair Corralation between Invictus Energy and Gulfport Energy
Assuming the 90 days horizon Invictus Energy Limited is expected to generate 4.53 times more return on investment than Gulfport Energy. However, Invictus Energy is 4.53 times more volatile than Gulfport Energy Operating. It trades about 0.15 of its potential returns per unit of risk. Gulfport Energy Operating is currently generating about 0.19 per unit of risk. If you would invest 4.20 in Invictus Energy Limited on October 15, 2024 and sell it today you would earn a total of 0.79 from holding Invictus Energy Limited or generate 18.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invictus Energy Limited vs. Gulfport Energy Operating
Performance |
| Timeline |
| Invictus Energy |
| Gulfport Energy Operating |
Invictus Energy and Gulfport Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invictus Energy and Gulfport Energy
The main advantage of trading using opposite Invictus Energy and Gulfport Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invictus Energy position performs unexpectedly, Gulfport 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 Gulfport Energy will offset losses from the drop in Gulfport Energy's long position.| Invictus Energy vs. Sintana Energy | Invictus Energy vs. 88 Energy Limited | Invictus Energy vs. Journey Energy | Invictus Energy vs. Trillion Energy International |
| Gulfport Energy vs. Epsilon Energy | Gulfport Energy vs. Granite Ridge Resources | Gulfport Energy vs. North European Oil | Gulfport Energy vs. CNX Resources Corp |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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