Correlation Between Stampede Drilling and Westshore Terminals
Can any of the company-specific risk be diversified away by investing in both Stampede Drilling and Westshore Terminals 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 Westshore Terminals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stampede Drilling and Westshore Terminals Investment, you can compare the effects of market volatilities on Stampede Drilling and Westshore Terminals 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 Westshore Terminals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stampede Drilling and Westshore Terminals.
Diversification Opportunities for Stampede Drilling and Westshore Terminals
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Stampede and Westshore is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Stampede Drilling and Westshore Terminals Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westshore Terminals 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 Westshore Terminals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westshore Terminals has no effect on the direction of Stampede Drilling i.e., Stampede Drilling and Westshore Terminals go up and down completely randomly.
Pair Corralation between Stampede Drilling and Westshore Terminals
Assuming the 90 days horizon Stampede Drilling is expected to under-perform the Westshore Terminals. In addition to that, Stampede Drilling is 3.69 times more volatile than Westshore Terminals Investment. It trades about -0.06 of its total potential returns per unit of risk. Westshore Terminals Investment is currently generating about -0.07 per unit of volatility. If you would invest 2,367 in Westshore Terminals Investment on September 13, 2024 and sell it today you would lose (34.00) from holding Westshore Terminals Investment or give up 1.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stampede Drilling vs. Westshore Terminals Investment
Performance |
| Timeline |
| Stampede Drilling |
| Westshore Terminals |
Stampede Drilling and Westshore Terminals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stampede Drilling and Westshore Terminals
The main advantage of trading using opposite Stampede Drilling and Westshore Terminals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stampede Drilling position performs unexpectedly, Westshore Terminals 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 Westshore Terminals will offset losses from the drop in Westshore Terminals' long position.| Stampede Drilling vs. Trican Well Service | Stampede Drilling vs. Ensign Energy Services | Stampede Drilling vs. Calfrac Well Services | Stampede Drilling vs. Birchcliff Energy |
| Westshore Terminals vs. Mullen Group | Westshore Terminals vs. Ritchie Bros Auctioneers | Westshore Terminals vs. Winpak | Westshore Terminals vs. North West |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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