Correlation Between Sintana Energy and US Energy
Can any of the company-specific risk be diversified away by investing in both Sintana Energy and US Energy 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 US Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sintana Energy and US Energy Corp, you can compare the effects of market volatilities on Sintana Energy and US Energy 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 US Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sintana Energy and US Energy.
Diversification Opportunities for Sintana Energy and US Energy
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sintana and USEG is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Sintana Energy and US Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Energy Corp 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 US Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Energy Corp has no effect on the direction of Sintana Energy i.e., Sintana Energy and US Energy go up and down completely randomly.
Pair Corralation between Sintana Energy and US Energy
Assuming the 90 days horizon Sintana Energy is expected to under-perform the US Energy. But the otc stock apears to be less risky and, when comparing its historical volatility, Sintana Energy is 4.26 times less risky than US Energy. The otc stock trades about -0.47 of its potential returns per unit of risk. The US Energy Corp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 161.00 in US Energy Corp on November 3, 2024 and sell it today you would earn a total of 58.00 from holding US Energy Corp or generate 36.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sintana Energy vs. US Energy Corp
Performance |
| Timeline |
| Sintana Energy |
| US Energy Corp |
Sintana Energy and US Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sintana Energy and US Energy
The main advantage of trading using opposite Sintana Energy and US Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sintana Energy position performs unexpectedly, US Energy 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 US Energy will offset losses from the drop in US Energy'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 |
| US Energy vs. PEDEVCO Corp | US Energy vs. Houston American Energy | US Energy vs. PHX Minerals | US Energy vs. Trio Petroleum Corp |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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