Correlation Between Stamper Oil and Valeura Energy
Can any of the company-specific risk be diversified away by investing in both Stamper Oil and Valeura 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 Stamper Oil and Valeura Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stamper Oil Gas and Valeura Energy, you can compare the effects of market volatilities on Stamper Oil and Valeura 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 Stamper Oil with a short position of Valeura Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stamper Oil and Valeura Energy.
Diversification Opportunities for Stamper Oil and Valeura Energy
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Stamper and Valeura is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Stamper Oil Gas and Valeura Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valeura Energy and Stamper Oil 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 Stamper Oil Gas are associated (or correlated) with Valeura Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valeura Energy has no effect on the direction of Stamper Oil i.e., Stamper Oil and Valeura Energy go up and down completely randomly.
Pair Corralation between Stamper Oil and Valeura Energy
Assuming the 90 days horizon Stamper Oil Gas is expected to generate 4.66 times more return on investment than Valeura Energy. However, Stamper Oil is 4.66 times more volatile than Valeura Energy. It trades about 0.06 of its potential returns per unit of risk. Valeura Energy is currently generating about 0.27 per unit of risk. If you would invest 1.22 in Stamper Oil Gas on October 15, 2024 and sell it today you would lose (0.22) from holding Stamper Oil Gas or give up 18.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.31% |
| Values | Daily Returns |
Stamper Oil Gas vs. Valeura Energy
Performance |
| Timeline |
| Stamper Oil Gas |
| Valeura Energy |
Stamper Oil and Valeura Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stamper Oil and Valeura Energy
The main advantage of trading using opposite Stamper Oil and Valeura Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stamper Oil position performs unexpectedly, Valeura 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 Valeura Energy will offset losses from the drop in Valeura Energy's long position.| Stamper Oil vs. East West Petroleum | Stamper Oil vs. Valeura Energy | Stamper Oil vs. Invictus Energy Limited | Stamper Oil vs. Africa Oil Corp |
| Valeura Energy vs. BK Technologies | Valeura Energy vs. Park Electrochemical | Valeura Energy vs. Digi International | Valeura Energy vs. NETGEAR |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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