Correlation Between Enwell Energy and ShaMaran Petroleum
Can any of the company-specific risk be diversified away by investing in both Enwell Energy and ShaMaran Petroleum 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 Enwell Energy and ShaMaran Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enwell Energy plc and ShaMaran Petroleum Corp, you can compare the effects of market volatilities on Enwell Energy and ShaMaran Petroleum 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 Enwell Energy with a short position of ShaMaran Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enwell Energy and ShaMaran Petroleum.
Diversification Opportunities for Enwell Energy and ShaMaran Petroleum
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Enwell and ShaMaran is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Enwell Energy plc and ShaMaran Petroleum Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ShaMaran Petroleum Corp and Enwell 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 Enwell Energy plc are associated (or correlated) with ShaMaran Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ShaMaran Petroleum Corp has no effect on the direction of Enwell Energy i.e., Enwell Energy and ShaMaran Petroleum go up and down completely randomly.
Pair Corralation between Enwell Energy and ShaMaran Petroleum
Assuming the 90 days horizon Enwell Energy is expected to generate 1.17 times less return on investment than ShaMaran Petroleum. In addition to that, Enwell Energy is 1.18 times more volatile than ShaMaran Petroleum Corp. It trades about 0.04 of its total potential returns per unit of risk. ShaMaran Petroleum Corp is currently generating about 0.05 per unit of volatility. If you would invest 7.00 in ShaMaran Petroleum Corp on August 24, 2024 and sell it today you would earn a total of 0.91 from holding ShaMaran Petroleum Corp or generate 13.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enwell Energy plc vs. ShaMaran Petroleum Corp
Performance |
| Timeline |
| Enwell Energy plc |
| ShaMaran Petroleum Corp |
Enwell Energy and ShaMaran Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enwell Energy and ShaMaran Petroleum
The main advantage of trading using opposite Enwell Energy and ShaMaran Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enwell Energy position performs unexpectedly, ShaMaran Petroleum 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 ShaMaran Petroleum will offset losses from the drop in ShaMaran Petroleum's long position.| Enwell Energy vs. Permian Resources | Enwell Energy vs. Devon Energy | Enwell Energy vs. EOG Resources | Enwell Energy vs. Coterra Energy |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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