Correlation Between Stampede Drilling and Rogers Communications
Can any of the company-specific risk be diversified away by investing in both Stampede Drilling and Rogers Communications 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 Rogers Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stampede Drilling and Rogers Communications, you can compare the effects of market volatilities on Stampede Drilling and Rogers Communications 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 Rogers Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stampede Drilling and Rogers Communications.
Diversification Opportunities for Stampede Drilling and Rogers Communications
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Stampede and Rogers is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Stampede Drilling and Rogers Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rogers Communications 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 Rogers Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rogers Communications has no effect on the direction of Stampede Drilling i.e., Stampede Drilling and Rogers Communications go up and down completely randomly.
Pair Corralation between Stampede Drilling and Rogers Communications
Assuming the 90 days horizon Stampede Drilling is expected to under-perform the Rogers Communications. In addition to that, Stampede Drilling is 2.5 times more volatile than Rogers Communications. It trades about -0.01 of its total potential returns per unit of risk. Rogers Communications is currently generating about -0.01 per unit of volatility. If you would invest 5,820 in Rogers Communications on August 27, 2024 and sell it today you would lose (421.00) from holding Rogers Communications or give up 7.23% 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. Rogers Communications
Performance |
| Timeline |
| Stampede Drilling |
| Rogers Communications |
Stampede Drilling and Rogers Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stampede Drilling and Rogers Communications
The main advantage of trading using opposite Stampede Drilling and Rogers Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stampede Drilling position performs unexpectedly, Rogers Communications 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 Rogers Communications will offset losses from the drop in Rogers Communications' long position.| Stampede Drilling vs. STEP Energy Services | Stampede Drilling vs. Southern Energy Corp | Stampede Drilling vs. PHX Energy Services |
| Rogers Communications vs. Lion One Metals | Rogers Communications vs. CNJ Capital Investments | Rogers Communications vs. North American Financial | Rogers Communications vs. Fairfax Financial Holdings |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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