Correlation Between Stampede Drilling and Ascot Resources
Can any of the company-specific risk be diversified away by investing in both Stampede Drilling and Ascot 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 Stampede Drilling and Ascot Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stampede Drilling and Ascot Resources, you can compare the effects of market volatilities on Stampede Drilling and Ascot 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 Stampede Drilling with a short position of Ascot Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stampede Drilling and Ascot Resources.
Diversification Opportunities for Stampede Drilling and Ascot Resources
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Stampede and Ascot is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Stampede Drilling and Ascot Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascot Resources and Stampede Drilling 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 Stampede Drilling are associated (or correlated) with Ascot Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascot Resources has no effect on the direction of Stampede Drilling i.e., Stampede Drilling and Ascot Resources go up and down completely randomly.
Pair Corralation between Stampede Drilling and Ascot Resources
Assuming the 90 days horizon Stampede Drilling is expected to generate 0.56 times more return on investment than Ascot Resources. However, Stampede Drilling is 1.8 times less risky than Ascot Resources. It trades about -0.03 of its potential returns per unit of risk. Ascot Resources is currently generating about -0.17 per unit of risk. If you would invest 19.00 in Stampede Drilling on November 27, 2024 and sell it today you would lose (2.00) from holding Stampede Drilling or give up 10.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stampede Drilling vs. Ascot Resources
Performance |
| Timeline |
| Stampede Drilling |
| Ascot Resources |
Stampede Drilling and Ascot Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stampede Drilling and Ascot Resources
The main advantage of trading using opposite Stampede Drilling and Ascot Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stampede Drilling position performs unexpectedly, Ascot 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 Ascot Resources will offset losses from the drop in Ascot Resources' long position.| Stampede Drilling vs. STEP Energy Services | Stampede Drilling vs. Southern Energy Corp | Stampede Drilling vs. PHX Energy Services |
| Ascot Resources vs. First National Financial | Ascot Resources vs. Calian Technologies | Ascot Resources vs. Canso Credit Trust | Ascot Resources vs. BLUERUSH Media Group |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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