Correlation Between 00108WAF7 and Occidental
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By analyzing existing cross correlation between AEP TEX INC and Occidental Petroleum 8875, you can compare the effects of market volatilities on 00108WAF7 and Occidental 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 00108WAF7 with a short position of Occidental. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAF7 and Occidental.
Diversification Opportunities for 00108WAF7 and Occidental
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between 00108WAF7 and Occidental is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding AEP TEX INC and Occidental Petroleum 8875 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Occidental Petroleum 8875 and 00108WAF7 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 AEP TEX INC are associated (or correlated) with Occidental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Occidental Petroleum 8875 has no effect on the direction of 00108WAF7 i.e., 00108WAF7 and Occidental go up and down completely randomly.
Pair Corralation between 00108WAF7 and Occidental
Assuming the 90 days trading horizon AEP TEX INC is expected to generate 5.22 times more return on investment than Occidental. However, 00108WAF7 is 5.22 times more volatile than Occidental Petroleum 8875. It trades about 0.11 of its potential returns per unit of risk. Occidental Petroleum 8875 is currently generating about 0.22 per unit of risk. If you would invest 7,351 in AEP TEX INC on September 2, 2024 and sell it today you would earn a total of 317.00 from holding AEP TEX INC or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 66.67% |
| Values | Daily Returns |
AEP TEX INC vs. Occidental Petroleum 8875
Performance |
| Timeline |
| AEP TEX INC |
| Occidental Petroleum 8875 |
00108WAF7 and Occidental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00108WAF7 and Occidental
The main advantage of trading using opposite 00108WAF7 and Occidental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAF7 position performs unexpectedly, Occidental 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 Occidental will offset losses from the drop in Occidental's long position.| 00108WAF7 vs. Zhihu Inc ADR | 00108WAF7 vs. Playtika Holding Corp | 00108WAF7 vs. Thor Industries | 00108WAF7 vs. Dana Inc |
| Occidental vs. SunLink Health Systems | Occidental vs. Cumberland Pharmaceuticals | Occidental vs. HUTCHMED DRC | Occidental vs. Sonida Senior Living |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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