Correlation Between Murphy Oil and Greenfire Resources
Can any of the company-specific risk be diversified away by investing in both Murphy Oil and Greenfire Resources 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 Murphy Oil and Greenfire Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Murphy Oil and Greenfire Resources, you can compare the effects of market volatilities on Murphy Oil and Greenfire Resources 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 Murphy Oil with a short position of Greenfire Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Murphy Oil and Greenfire Resources.
Diversification Opportunities for Murphy Oil and Greenfire Resources
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Murphy and Greenfire is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Murphy Oil and Greenfire Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenfire Resources and Murphy 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 Murphy Oil are associated (or correlated) with Greenfire Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenfire Resources has no effect on the direction of Murphy Oil i.e., Murphy Oil and Greenfire Resources go up and down completely randomly.
Pair Corralation between Murphy Oil and Greenfire Resources
Considering the 90-day investment horizon Murphy Oil is expected to generate 0.49 times more return on investment than Greenfire Resources. However, Murphy Oil is 2.03 times less risky than Greenfire Resources. It trades about 0.43 of its potential returns per unit of risk. Greenfire Resources is currently generating about 0.19 per unit of risk. If you would invest 2,814 in Murphy Oil on October 20, 2024 and sell it today you would earn a total of 410.00 from holding Murphy Oil or generate 14.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Murphy Oil vs. Greenfire Resources
Performance |
| Timeline |
| Murphy Oil |
| Greenfire Resources |
Murphy Oil and Greenfire Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Murphy Oil and Greenfire Resources
The main advantage of trading using opposite Murphy Oil and Greenfire Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Murphy Oil position performs unexpectedly, Greenfire Resources 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 Greenfire Resources will offset losses from the drop in Greenfire Resources' long position.| Murphy Oil vs. Matador Resources | Murphy Oil vs. Civitas Resources | Murphy Oil vs. Magnolia Oil Gas | Murphy Oil vs. SM Energy Co |
| Greenfire Resources vs. ScanSource | Greenfire Resources vs. Ambev SA ADR | Greenfire Resources vs. Primo Brands | Greenfire Resources vs. Boston Beer |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |