Correlation Between Bristow and Kodiak Gas
Can any of the company-specific risk be diversified away by investing in both Bristow and Kodiak Gas 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 Bristow and Kodiak Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bristow Group and Kodiak Gas Services,, you can compare the effects of market volatilities on Bristow and Kodiak Gas 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 Bristow with a short position of Kodiak Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristow and Kodiak Gas.
Diversification Opportunities for Bristow and Kodiak Gas
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bristow and Kodiak is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Bristow Group and Kodiak Gas Services, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kodiak Gas Services, and Bristow 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 Bristow Group are associated (or correlated) with Kodiak Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kodiak Gas Services, has no effect on the direction of Bristow i.e., Bristow and Kodiak Gas go up and down completely randomly.
Pair Corralation between Bristow and Kodiak Gas
Given the investment horizon of 90 days Bristow is expected to generate 26.67 times less return on investment than Kodiak Gas. But when comparing it to its historical volatility, Bristow Group is 22.36 times less risky than Kodiak Gas. It trades about 0.05 of its potential returns per unit of risk. Kodiak Gas Services, is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Kodiak Gas Services, on September 2, 2024 and sell it today you would earn a total of 4,044 from holding Kodiak Gas Services, or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 72.78% |
| Values | Daily Returns |
Bristow Group vs. Kodiak Gas Services,
Performance |
| Timeline |
| Bristow Group |
| Kodiak Gas Services, |
Bristow and Kodiak Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bristow and Kodiak Gas
The main advantage of trading using opposite Bristow and Kodiak Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristow position performs unexpectedly, Kodiak Gas 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 Kodiak Gas will offset losses from the drop in Kodiak Gas' long position.| Bristow vs. Oil States International | Bristow vs. Geospace Technologies | Bristow vs. Weatherford International PLC | Bristow vs. Enerflex |
| Kodiak Gas vs. Sonos Inc | Kodiak Gas vs. Universal Display | Kodiak Gas vs. Capital Clean Energy | Kodiak Gas vs. Canlan Ice Sports |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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