Correlation Between Whitecap Resources and Kiwetinohk Energy
Can any of the company-specific risk be diversified away by investing in both Whitecap Resources and Kiwetinohk 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 Whitecap Resources and Kiwetinohk Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Whitecap Resources and Kiwetinohk Energy Corp, you can compare the effects of market volatilities on Whitecap Resources and Kiwetinohk 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 Whitecap Resources with a short position of Kiwetinohk Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Whitecap Resources and Kiwetinohk Energy.
Diversification Opportunities for Whitecap Resources and Kiwetinohk Energy
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Whitecap and Kiwetinohk is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Whitecap Resources and Kiwetinohk Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiwetinohk Energy Corp and Whitecap Resources 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 Whitecap Resources are associated (or correlated) with Kiwetinohk Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiwetinohk Energy Corp has no effect on the direction of Whitecap Resources i.e., Whitecap Resources and Kiwetinohk Energy go up and down completely randomly.
Pair Corralation between Whitecap Resources and Kiwetinohk Energy
Assuming the 90 days horizon Whitecap Resources is expected to under-perform the Kiwetinohk Energy. In addition to that, Whitecap Resources is 1.77 times more volatile than Kiwetinohk Energy Corp. It trades about -0.26 of its total potential returns per unit of risk. Kiwetinohk Energy Corp is currently generating about 0.32 per unit of volatility. If you would invest 1,117 in Kiwetinohk Energy Corp on November 3, 2024 and sell it today you would earn a total of 63.00 from holding Kiwetinohk Energy Corp or generate 5.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Whitecap Resources vs. Kiwetinohk Energy Corp
Performance |
| Timeline |
| Whitecap Resources |
| Kiwetinohk Energy Corp |
Whitecap Resources and Kiwetinohk Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Whitecap Resources and Kiwetinohk Energy
The main advantage of trading using opposite Whitecap Resources and Kiwetinohk Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Whitecap Resources position performs unexpectedly, Kiwetinohk 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 Kiwetinohk Energy will offset losses from the drop in Kiwetinohk Energy's long position.| Whitecap Resources vs. Agnico Eagle Mines | Whitecap Resources vs. Osisko Gold Ro | Whitecap Resources vs. Gold Fields Ltd | Whitecap Resources vs. AngloGold Ashanti plc |
| Kiwetinohk Energy vs. Cheetah Mobile | Kiwetinohk Energy vs. TrueCar | Kiwetinohk Energy vs. Prosus NV ADR | Kiwetinohk Energy vs. MediaAlpha |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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