Correlation Between Liberty Oilfield and Expro Group
Can any of the company-specific risk be diversified away by investing in both Liberty Oilfield and Expro Group 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 Liberty Oilfield and Expro Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Oilfield Services and Expro Group Holdings, you can compare the effects of market volatilities on Liberty Oilfield and Expro Group 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 Liberty Oilfield with a short position of Expro Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Oilfield and Expro Group.
Diversification Opportunities for Liberty Oilfield and Expro Group
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Liberty and Expro is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Oilfield Services and Expro Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expro Group Holdings and Liberty Oilfield 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 Liberty Oilfield Services are associated (or correlated) with Expro Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expro Group Holdings has no effect on the direction of Liberty Oilfield i.e., Liberty Oilfield and Expro Group go up and down completely randomly.
Pair Corralation between Liberty Oilfield and Expro Group
Given the investment horizon of 90 days Liberty Oilfield is expected to generate 1.12 times less return on investment than Expro Group. But when comparing it to its historical volatility, Liberty Oilfield Services is 1.04 times less risky than Expro Group. It trades about 0.13 of its potential returns per unit of risk. Expro Group Holdings is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,278 in Expro Group Holdings on September 3, 2024 and sell it today you would earn a total of 111.00 from holding Expro Group Holdings or generate 8.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liberty Oilfield Services vs. Expro Group Holdings
Performance |
| Timeline |
| Liberty Oilfield Services |
| Expro Group Holdings |
Liberty Oilfield and Expro Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Oilfield and Expro Group
The main advantage of trading using opposite Liberty Oilfield and Expro Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Oilfield position performs unexpectedly, Expro Group 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 Expro Group will offset losses from the drop in Expro Group's long position.| Liberty Oilfield vs. Ranger Energy Services | Liberty Oilfield vs. ProFrac Holding Corp | Liberty Oilfield vs. Archrock | Liberty Oilfield vs. Newpark Resources |
| Expro Group vs. ChampionX | Expro Group vs. Ranger Energy Services | Expro Group vs. Cactus Inc | Expro Group vs. MRC Global |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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