Correlation Between ShaMaran Petroleum and I3 Energy
Can any of the company-specific risk be diversified away by investing in both ShaMaran Petroleum and I3 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 ShaMaran Petroleum and I3 Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ShaMaran Petroleum Corp and i3 Energy Plc, you can compare the effects of market volatilities on ShaMaran Petroleum and I3 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 ShaMaran Petroleum with a short position of I3 Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of ShaMaran Petroleum and I3 Energy.
Diversification Opportunities for ShaMaran Petroleum and I3 Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ShaMaran and ITEEF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ShaMaran Petroleum Corp and i3 Energy Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on i3 Energy Plc and ShaMaran Petroleum 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 ShaMaran Petroleum Corp are associated (or correlated) with I3 Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of i3 Energy Plc has no effect on the direction of ShaMaran Petroleum i.e., ShaMaran Petroleum and I3 Energy go up and down completely randomly.
Pair Corralation between ShaMaran Petroleum and I3 Energy
Assuming the 90 days horizon ShaMaran Petroleum Corp is expected to generate 1.59 times more return on investment than I3 Energy. However, ShaMaran Petroleum is 1.59 times more volatile than i3 Energy Plc. It trades about 0.05 of its potential returns per unit of risk. i3 Energy Plc is currently generating about 0.02 per unit of risk. If you would invest 7.00 in ShaMaran Petroleum Corp on August 24, 2024 and sell it today you would earn a total of 0.91 from holding ShaMaran Petroleum Corp or generate 13.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.38% |
| Values | Daily Returns |
ShaMaran Petroleum Corp vs. i3 Energy Plc
Performance |
| Timeline |
| ShaMaran Petroleum Corp |
| i3 Energy Plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ShaMaran Petroleum and I3 Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ShaMaran Petroleum and I3 Energy
The main advantage of trading using opposite ShaMaran Petroleum and I3 Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ShaMaran Petroleum position performs unexpectedly, I3 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 I3 Energy will offset losses from the drop in I3 Energy's long position.| ShaMaran Petroleum vs. PetroShale | ShaMaran Petroleum vs. Africa Energy Corp | ShaMaran Petroleum vs. Horizon Oil Limited | ShaMaran Petroleum vs. Saturn Oil Gas |
| I3 Energy vs. Permian Resources | I3 Energy vs. Devon Energy | I3 Energy vs. EOG Resources | I3 Energy vs. Coterra 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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