Correlation Between Patterson UTI and Menora Mivtachim
Can any of the company-specific risk be diversified away by investing in both Patterson UTI and Menora Mivtachim 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 Patterson UTI and Menora Mivtachim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Patterson UTI Energy and Menora Mivtachim Holdings, you can compare the effects of market volatilities on Patterson UTI and Menora Mivtachim 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 Patterson UTI with a short position of Menora Mivtachim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Patterson UTI and Menora Mivtachim.
Diversification Opportunities for Patterson UTI and Menora Mivtachim
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Patterson and Menora is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Patterson UTI Energy and Menora Mivtachim Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Menora Mivtachim Holdings and Patterson UTI 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 Patterson UTI Energy are associated (or correlated) with Menora Mivtachim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Menora Mivtachim Holdings has no effect on the direction of Patterson UTI i.e., Patterson UTI and Menora Mivtachim go up and down completely randomly.
Pair Corralation between Patterson UTI and Menora Mivtachim
Given the investment horizon of 90 days Patterson UTI Energy is expected to under-perform the Menora Mivtachim. In addition to that, Patterson UTI is 2.94 times more volatile than Menora Mivtachim Holdings. It trades about -0.02 of its total potential returns per unit of risk. Menora Mivtachim Holdings is currently generating about 0.1 per unit of volatility. If you would invest 1,563 in Menora Mivtachim Holdings on October 25, 2024 and sell it today you would earn a total of 942.00 from holding Menora Mivtachim Holdings or generate 60.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Patterson UTI Energy vs. Menora Mivtachim Holdings
Performance |
| Timeline |
| Patterson UTI Energy |
| Menora Mivtachim Holdings |
Patterson UTI and Menora Mivtachim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Patterson UTI and Menora Mivtachim
The main advantage of trading using opposite Patterson UTI and Menora Mivtachim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Patterson UTI position performs unexpectedly, Menora Mivtachim 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 Menora Mivtachim will offset losses from the drop in Menora Mivtachim's long position.| Patterson UTI vs. Nabors Industries | Patterson UTI vs. Precision Drilling | Patterson UTI vs. Noble plc | Patterson UTI vs. Helmerich and Payne |
| Menora Mivtachim vs. Vantage Drilling International | Menora Mivtachim vs. Nabors Industries | Menora Mivtachim vs. Noble plc | Menora Mivtachim vs. Anterix |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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