Correlation Between Tidewater and Baker Hughes
Can any of the company-specific risk be diversified away by investing in both Tidewater and Baker Hughes 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 Tidewater and Baker Hughes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tidewater and Baker Hughes Co, you can compare the effects of market volatilities on Tidewater and Baker Hughes 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 Tidewater with a short position of Baker Hughes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidewater and Baker Hughes.
Diversification Opportunities for Tidewater and Baker Hughes
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Tidewater and Baker is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Tidewater and Baker Hughes Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baker Hughes and Tidewater 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 Tidewater are associated (or correlated) with Baker Hughes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baker Hughes has no effect on the direction of Tidewater i.e., Tidewater and Baker Hughes go up and down completely randomly.
Pair Corralation between Tidewater and Baker Hughes
Considering the 90-day investment horizon Tidewater is expected to under-perform the Baker Hughes. In addition to that, Tidewater is 1.41 times more volatile than Baker Hughes Co. It trades about -0.18 of its total potential returns per unit of risk. Baker Hughes Co is currently generating about 0.3 per unit of volatility. If you would invest 3,719 in Baker Hughes Co on August 27, 2024 and sell it today you would earn a total of 636.00 from holding Baker Hughes Co or generate 17.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tidewater vs. Baker Hughes Co
Performance |
| Timeline |
| Tidewater |
| Baker Hughes |
Tidewater and Baker Hughes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tidewater and Baker Hughes
The main advantage of trading using opposite Tidewater and Baker Hughes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidewater position performs unexpectedly, Baker Hughes 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 Baker Hughes will offset losses from the drop in Baker Hughes' long position.| Tidewater vs. ProPetro Holding Corp | Tidewater vs. RPC Inc | Tidewater vs. MRC Global | Tidewater vs. Expro Group Holdings |
| Baker Hughes vs. Schlumberger NV | Baker Hughes vs. NOV Inc | Baker Hughes vs. Weatherford International PLC | Baker Hughes vs. Tenaris SA ADR |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |