Correlation Between Touchstone Exploration and Hemisphere Energy
Can any of the company-specific risk be diversified away by investing in both Touchstone Exploration and Hemisphere 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 Touchstone Exploration and Hemisphere Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Exploration and Hemisphere Energy, you can compare the effects of market volatilities on Touchstone Exploration and Hemisphere 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 Touchstone Exploration with a short position of Hemisphere Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Exploration and Hemisphere Energy.
Diversification Opportunities for Touchstone Exploration and Hemisphere Energy
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Touchstone and Hemisphere is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Exploration and Hemisphere Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hemisphere Energy and Touchstone Exploration 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 Touchstone Exploration are associated (or correlated) with Hemisphere Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hemisphere Energy has no effect on the direction of Touchstone Exploration i.e., Touchstone Exploration and Hemisphere Energy go up and down completely randomly.
Pair Corralation between Touchstone Exploration and Hemisphere Energy
Assuming the 90 days trading horizon Touchstone Exploration is expected to under-perform the Hemisphere Energy. In addition to that, Touchstone Exploration is 1.74 times more volatile than Hemisphere Energy. It trades about -0.07 of its total potential returns per unit of risk. Hemisphere Energy is currently generating about 0.06 per unit of volatility. If you would invest 184.00 in Hemisphere Energy on September 2, 2024 and sell it today you would earn a total of 4.00 from holding Hemisphere Energy or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Touchstone Exploration vs. Hemisphere Energy
Performance |
| Timeline |
| Touchstone Exploration |
| Hemisphere Energy |
Touchstone Exploration and Hemisphere Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Exploration and Hemisphere Energy
The main advantage of trading using opposite Touchstone Exploration and Hemisphere Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Exploration position performs unexpectedly, Hemisphere 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 Hemisphere Energy will offset losses from the drop in Hemisphere Energy's long position.| Touchstone Exploration vs. Headwater Exploration | Touchstone Exploration vs. Gear Energy | Touchstone Exploration vs. Canacol Energy | Touchstone Exploration vs. InPlay Oil Corp |
| Hemisphere Energy vs. InPlay Oil Corp | Hemisphere Energy vs. Pine Cliff Energy | Hemisphere Energy vs. Journey Energy | Hemisphere Energy vs. Yangarra 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |