Correlation Between Total Energy and Now
Can any of the company-specific risk be diversified away by investing in both Total Energy and Now 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 Total Energy and Now into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Total Energy Services and Now Inc, you can compare the effects of market volatilities on Total Energy and Now 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 Total Energy with a short position of Now. Check out your portfolio center. Please also check ongoing floating volatility patterns of Total Energy and Now.
Diversification Opportunities for Total Energy and Now
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Total and Now is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Total Energy Services and Now Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Now Inc and Total Energy 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 Total Energy Services are associated (or correlated) with Now. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Now Inc has no effect on the direction of Total Energy i.e., Total Energy and Now go up and down completely randomly.
Pair Corralation between Total Energy and Now
Assuming the 90 days horizon Total Energy Services is expected to generate 1.0 times more return on investment than Now. However, Total Energy is 1.0 times more volatile than Now Inc. It trades about 0.09 of its potential returns per unit of risk. Now Inc is currently generating about 0.05 per unit of risk. If you would invest 666.00 in Total Energy Services on September 3, 2024 and sell it today you would earn a total of 168.00 from holding Total Energy Services or generate 25.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Total Energy Services vs. Now Inc
Performance |
| Timeline |
| Total Energy Services |
| Now Inc |
Total Energy and Now Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Total Energy and Now
The main advantage of trading using opposite Total Energy and Now positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Total Energy position performs unexpectedly, Now 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 Now will offset losses from the drop in Now's long position.| Total Energy vs. Source Energy Services | Total Energy vs. Trican Well Service | Total Energy vs. STEP Energy Services | Total Energy vs. Koil Energy Solutions |
| Now vs. Oil States International | Now vs. Oceaneering International | Now vs. Geospace Technologies | Now vs. Newpark Resources |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |