Correlation Between PHX Minerals and Battalion Oil
Can any of the company-specific risk be diversified away by investing in both PHX Minerals and Battalion Oil 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 PHX Minerals and Battalion Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PHX Minerals and Battalion Oil Corp, you can compare the effects of market volatilities on PHX Minerals and Battalion Oil 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 PHX Minerals with a short position of Battalion Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of PHX Minerals and Battalion Oil.
Diversification Opportunities for PHX Minerals and Battalion Oil
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between PHX and Battalion is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding PHX Minerals and Battalion Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Battalion Oil Corp and PHX Minerals 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 PHX Minerals are associated (or correlated) with Battalion Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Battalion Oil Corp has no effect on the direction of PHX Minerals i.e., PHX Minerals and Battalion Oil go up and down completely randomly.
Pair Corralation between PHX Minerals and Battalion Oil
Considering the 90-day investment horizon PHX Minerals is expected to generate 0.22 times more return on investment than Battalion Oil. However, PHX Minerals is 4.52 times less risky than Battalion Oil. It trades about 0.24 of its potential returns per unit of risk. Battalion Oil Corp is currently generating about -0.19 per unit of risk. If you would invest 340.00 in PHX Minerals on September 4, 2024 and sell it today you would earn a total of 45.00 from holding PHX Minerals or generate 13.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PHX Minerals vs. Battalion Oil Corp
Performance |
| Timeline |
| PHX Minerals |
| Battalion Oil Corp |
PHX Minerals and Battalion Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PHX Minerals and Battalion Oil
The main advantage of trading using opposite PHX Minerals and Battalion Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PHX Minerals position performs unexpectedly, Battalion Oil 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 Battalion Oil will offset losses from the drop in Battalion Oil's long position.| PHX Minerals vs. Evolution Petroleum | PHX Minerals vs. GeoPark | PHX Minerals vs. Granite Ridge Resources | PHX Minerals vs. California Resources Corp |
| Battalion Oil vs. Evolution Petroleum | Battalion Oil vs. Ring Energy | Battalion Oil vs. Gran Tierra Energy | Battalion Oil vs. PEDEVCO Corp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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