Correlation Between Sintana Energy and Falcon Oil
Can any of the company-specific risk be diversified away by investing in both Sintana Energy and Falcon Oil 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 Sintana Energy and Falcon Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sintana Energy and Falcon Oil Gas, you can compare the effects of market volatilities on Sintana Energy and Falcon Oil 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 Sintana Energy with a short position of Falcon Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sintana Energy and Falcon Oil.
Diversification Opportunities for Sintana Energy and Falcon Oil
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sintana and Falcon is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Sintana Energy and Falcon Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Falcon Oil Gas and Sintana 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 Sintana Energy are associated (or correlated) with Falcon Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Falcon Oil Gas has no effect on the direction of Sintana Energy i.e., Sintana Energy and Falcon Oil go up and down completely randomly.
Pair Corralation between Sintana Energy and Falcon Oil
Assuming the 90 days horizon Sintana Energy is expected to under-perform the Falcon Oil. But the otc stock apears to be less risky and, when comparing its historical volatility, Sintana Energy is 2.1 times less risky than Falcon Oil. The otc stock trades about -0.47 of its potential returns per unit of risk. The Falcon Oil Gas is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 6.00 in Falcon Oil Gas on November 3, 2024 and sell it today you would earn a total of 3.00 from holding Falcon Oil Gas or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sintana Energy vs. Falcon Oil Gas
Performance |
| Timeline |
| Sintana Energy |
| Falcon Oil Gas |
Sintana Energy and Falcon Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sintana Energy and Falcon Oil
The main advantage of trading using opposite Sintana Energy and Falcon Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sintana Energy position performs unexpectedly, Falcon Oil 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 Falcon Oil will offset losses from the drop in Falcon Oil's long position.| Sintana Energy vs. Kiwetinohk Energy Corp | Sintana Energy vs. Melbana Energy Limited | Sintana Energy vs. Pancontinental Oil Gas | Sintana Energy vs. Eco Oil Gas |
| Falcon Oil vs. Gulf Keystone Petroleum | Falcon Oil vs. Maverick Energy Group | Falcon Oil vs. North European Oil | Falcon Oil vs. SandRidge Energy |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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