Correlation Between PEDEVCO Corp and Canadian Natural
Can any of the company-specific risk be diversified away by investing in both PEDEVCO Corp and Canadian Natural 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 PEDEVCO Corp and Canadian Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PEDEVCO Corp and Canadian Natural Resources, you can compare the effects of market volatilities on PEDEVCO Corp and Canadian Natural 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 PEDEVCO Corp with a short position of Canadian Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of PEDEVCO Corp and Canadian Natural.
Diversification Opportunities for PEDEVCO Corp and Canadian Natural
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PEDEVCO and Canadian is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding PEDEVCO Corp and Canadian Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Natural Res and PEDEVCO Corp 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 PEDEVCO Corp are associated (or correlated) with Canadian Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Natural Res has no effect on the direction of PEDEVCO Corp i.e., PEDEVCO Corp and Canadian Natural go up and down completely randomly.
Pair Corralation between PEDEVCO Corp and Canadian Natural
Considering the 90-day investment horizon PEDEVCO Corp is expected to under-perform the Canadian Natural. In addition to that, PEDEVCO Corp is 1.13 times more volatile than Canadian Natural Resources. It trades about -0.16 of its total potential returns per unit of risk. Canadian Natural Resources is currently generating about -0.06 per unit of volatility. If you would invest 3,425 in Canadian Natural Resources on September 4, 2024 and sell it today you would lose (67.00) from holding Canadian Natural Resources or give up 1.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PEDEVCO Corp vs. Canadian Natural Resources
Performance |
| Timeline |
| PEDEVCO Corp |
| Canadian Natural Res |
PEDEVCO Corp and Canadian Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PEDEVCO Corp and Canadian Natural
The main advantage of trading using opposite PEDEVCO Corp and Canadian Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PEDEVCO Corp position performs unexpectedly, Canadian Natural 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 Canadian Natural will offset losses from the drop in Canadian Natural's long position.| PEDEVCO Corp vs. Gran Tierra Energy | PEDEVCO Corp vs. Permian Resources | PEDEVCO Corp vs. PermRock Royalty Trust | PEDEVCO Corp vs. MV Oil Trust |
| Canadian Natural vs. Baytex Energy Corp | Canadian Natural vs. Vermilion Energy | Canadian Natural vs. Obsidian Energy | Canadian Natural vs. Ovintiv |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |