Correlation Between Nextier Oilfield and ProPetro Holding
Can any of the company-specific risk be diversified away by investing in both Nextier Oilfield and ProPetro Holding 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 Nextier Oilfield and ProPetro Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nextier Oilfield Solutions and ProPetro Holding Corp, you can compare the effects of market volatilities on Nextier Oilfield and ProPetro Holding 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 Nextier Oilfield with a short position of ProPetro Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextier Oilfield and ProPetro Holding.
Diversification Opportunities for Nextier Oilfield and ProPetro Holding
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nextier and ProPetro is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Nextier Oilfield Solutions and ProPetro Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProPetro Holding Corp and Nextier 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 Nextier Oilfield Solutions are associated (or correlated) with ProPetro Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProPetro Holding Corp has no effect on the direction of Nextier Oilfield i.e., Nextier Oilfield and ProPetro Holding go up and down completely randomly.
Pair Corralation between Nextier Oilfield and ProPetro Holding
If you would invest 756.00 in ProPetro Holding Corp on August 28, 2024 and sell it today you would earn a total of 89.00 from holding ProPetro Holding Corp or generate 11.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Nextier Oilfield Solutions vs. ProPetro Holding Corp
Performance |
| Timeline |
| Nextier Oilfield Sol |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| ProPetro Holding Corp |
Nextier Oilfield and ProPetro Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nextier Oilfield and ProPetro Holding
The main advantage of trading using opposite Nextier Oilfield and ProPetro Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nextier Oilfield position performs unexpectedly, ProPetro Holding 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 ProPetro Holding will offset losses from the drop in ProPetro Holding's long position.| Nextier Oilfield vs. ProPetro Holding Corp | Nextier Oilfield vs. Select Energy Services | Nextier Oilfield vs. Liberty Oilfield Services | Nextier Oilfield vs. Cactus Inc |
| ProPetro Holding vs. Ranger Energy Services | ProPetro Holding vs. Newpark Resources | ProPetro Holding vs. RPC Inc | ProPetro Holding vs. Archrock |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |