Correlation Between San Juan and Inpex Corp
Can any of the company-specific risk be diversified away by investing in both San Juan and Inpex Corp 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 San Juan and Inpex Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between San Juan Basin and Inpex Corp ADR, you can compare the effects of market volatilities on San Juan and Inpex Corp 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 San Juan with a short position of Inpex Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of San Juan and Inpex Corp.
Diversification Opportunities for San Juan and Inpex Corp
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between San and Inpex is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding San Juan Basin and Inpex Corp ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inpex Corp ADR and San Juan 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 San Juan Basin are associated (or correlated) with Inpex Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inpex Corp ADR has no effect on the direction of San Juan i.e., San Juan and Inpex Corp go up and down completely randomly.
Pair Corralation between San Juan and Inpex Corp
Considering the 90-day investment horizon San Juan Basin is expected to generate 2.48 times more return on investment than Inpex Corp. However, San Juan is 2.48 times more volatile than Inpex Corp ADR. It trades about 0.09 of its potential returns per unit of risk. Inpex Corp ADR is currently generating about 0.01 per unit of risk. If you would invest 402.00 in San Juan Basin on September 12, 2024 and sell it today you would earn a total of 22.00 from holding San Juan Basin or generate 5.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
San Juan Basin vs. Inpex Corp ADR
Performance |
| Timeline |
| San Juan Basin |
| Inpex Corp ADR |
San Juan and Inpex Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with San Juan and Inpex Corp
The main advantage of trading using opposite San Juan and Inpex Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if San Juan position performs unexpectedly, Inpex Corp 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 Inpex Corp will offset losses from the drop in Inpex Corp's long position.| San Juan vs. POSCO Holdings | San Juan vs. Schweizerische Nationalbank | San Juan vs. Berkshire Hathaway | San Juan vs. Berkshire Hathaway |
| Inpex Corp vs. San Leon Energy | Inpex Corp vs. Enwell Energy plc | Inpex Corp vs. Dno ASA | Inpex Corp vs. Questerre 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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