Correlation Between Marathon Oil and H1ES34
Can any of the company-specific risk be diversified away by investing in both Marathon Oil and H1ES34 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 Marathon Oil and H1ES34 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marathon Oil and H1ES34, you can compare the effects of market volatilities on Marathon Oil and H1ES34 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 Marathon Oil with a short position of H1ES34. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marathon Oil and H1ES34.
Diversification Opportunities for Marathon Oil and H1ES34
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marathon and H1ES34 is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Marathon Oil and H1ES34 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on H1ES34 and Marathon 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 Marathon Oil are associated (or correlated) with H1ES34. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of H1ES34 has no effect on the direction of Marathon Oil i.e., Marathon Oil and H1ES34 go up and down completely randomly.
Pair Corralation between Marathon Oil and H1ES34
If you would invest 37,818 in H1ES34 on September 27, 2024 and sell it today you would earn a total of 106.00 from holding H1ES34 or generate 0.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Marathon Oil vs. H1ES34
Performance |
| Timeline |
| Marathon Oil |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
| H1ES34 |
Marathon Oil and H1ES34 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marathon Oil and H1ES34
The main advantage of trading using opposite Marathon Oil and H1ES34 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marathon Oil position performs unexpectedly, H1ES34 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 H1ES34 will offset losses from the drop in H1ES34's long position.| Marathon Oil vs. ConocoPhillips | Marathon Oil vs. EOG Resources | Marathon Oil vs. Occidental Petroleum | Marathon Oil vs. Devon Energy |
| H1ES34 vs. ConocoPhillips | H1ES34 vs. EOG Resources | H1ES34 vs. Occidental Petroleum | H1ES34 vs. Devon 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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