Correlation Between Questerre Energy and Petrus Resources
Can any of the company-specific risk be diversified away by investing in both Questerre Energy and Petrus Resources 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 Questerre Energy and Petrus Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Questerre Energy and Petrus Resources, you can compare the effects of market volatilities on Questerre Energy and Petrus Resources 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 Questerre Energy with a short position of Petrus Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Questerre Energy and Petrus Resources.
Diversification Opportunities for Questerre Energy and Petrus Resources
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Questerre and Petrus is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Questerre Energy and Petrus Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrus Resources and Questerre Energy 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 Questerre Energy are associated (or correlated) with Petrus Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrus Resources has no effect on the direction of Questerre Energy i.e., Questerre Energy and Petrus Resources go up and down completely randomly.
Pair Corralation between Questerre Energy and Petrus Resources
Assuming the 90 days horizon Questerre Energy is expected to generate 6.7 times less return on investment than Petrus Resources. But when comparing it to its historical volatility, Questerre Energy is 1.05 times less risky than Petrus Resources. It trades about 0.01 of its potential returns per unit of risk. Petrus Resources is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 96.00 in Petrus Resources on October 24, 2024 and sell it today you would earn a total of 2.00 from holding Petrus Resources or generate 2.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Questerre Energy vs. Petrus Resources
Performance |
| Timeline |
| Questerre Energy |
| Petrus Resources |
Questerre Energy and Petrus Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Questerre Energy and Petrus Resources
The main advantage of trading using opposite Questerre Energy and Petrus Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Questerre Energy position performs unexpectedly, Petrus Resources 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 Petrus Resources will offset losses from the drop in Petrus Resources' long position.| Questerre Energy vs. Aminex PLC | Questerre Energy vs. FAR Limited | Questerre Energy vs. PetroShale | Questerre Energy vs. San Leon Energy |
| Petrus Resources vs. FAR Limited | Petrus Resources vs. Valeura Energy | Petrus Resources vs. Epsilon Energy | Petrus Resources vs. PetroShale |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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