Correlation Between Pine Cliff and Saturn Oil
Can any of the company-specific risk be diversified away by investing in both Pine Cliff and Saturn 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 Pine Cliff and Saturn Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pine Cliff Energy and Saturn Oil Gas, you can compare the effects of market volatilities on Pine Cliff and Saturn 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 Pine Cliff with a short position of Saturn Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pine Cliff and Saturn Oil.
Diversification Opportunities for Pine Cliff and Saturn Oil
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pine and Saturn is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Pine Cliff Energy and Saturn Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saturn Oil Gas and Pine Cliff 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 Pine Cliff Energy are associated (or correlated) with Saturn Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saturn Oil Gas has no effect on the direction of Pine Cliff i.e., Pine Cliff and Saturn Oil go up and down completely randomly.
Pair Corralation between Pine Cliff and Saturn Oil
Assuming the 90 days horizon Pine Cliff Energy is expected to generate 1.03 times more return on investment than Saturn Oil. However, Pine Cliff is 1.03 times more volatile than Saturn Oil Gas. It trades about -0.01 of its potential returns per unit of risk. Saturn Oil Gas is currently generating about -0.01 per unit of risk. If you would invest 70.00 in Pine Cliff Energy on September 1, 2024 and sell it today you would lose (7.00) from holding Pine Cliff Energy or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Pine Cliff Energy vs. Saturn Oil Gas
Performance |
| Timeline |
| Pine Cliff Energy |
| Saturn Oil Gas |
Pine Cliff and Saturn Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pine Cliff and Saturn Oil
The main advantage of trading using opposite Pine Cliff and Saturn Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pine Cliff position performs unexpectedly, Saturn 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 Saturn Oil will offset losses from the drop in Saturn Oil's long position.| Pine Cliff vs. Athabasca Oil Corp | Pine Cliff vs. Cardinal Energy | Pine Cliff vs. Tamarack Valley Energy | Pine Cliff vs. Saturn Oil Gas |
| Saturn Oil vs. San Leon Energy | Saturn Oil vs. Enwell Energy plc | Saturn Oil vs. Dno ASA | Saturn Oil vs. Questerre 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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