Correlation Between Weatherford International and Bristow
Can any of the company-specific risk be diversified away by investing in both Weatherford International and Bristow 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 Weatherford International and Bristow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weatherford International PLC and Bristow Group, you can compare the effects of market volatilities on Weatherford International and Bristow 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 Weatherford International with a short position of Bristow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weatherford International and Bristow.
Diversification Opportunities for Weatherford International and Bristow
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Weatherford and Bristow is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Weatherford International PLC and Bristow Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bristow Group and Weatherford International 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 Weatherford International PLC are associated (or correlated) with Bristow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bristow Group has no effect on the direction of Weatherford International i.e., Weatherford International and Bristow go up and down completely randomly.
Pair Corralation between Weatherford International and Bristow
Given the investment horizon of 90 days Weatherford International PLC is expected to under-perform the Bristow. In addition to that, Weatherford International is 1.11 times more volatile than Bristow Group. It trades about -0.09 of its total potential returns per unit of risk. Bristow Group is currently generating about 0.02 per unit of volatility. If you would invest 3,666 in Bristow Group on August 24, 2024 and sell it today you would earn a total of 133.00 from holding Bristow Group or generate 3.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weatherford International PLC vs. Bristow Group
Performance |
| Timeline |
| Weatherford International |
| Bristow Group |
Weatherford International and Bristow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weatherford International and Bristow
The main advantage of trading using opposite Weatherford International and Bristow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weatherford International position performs unexpectedly, Bristow 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 Bristow will offset losses from the drop in Bristow's long position.| Weatherford International vs. Bristow Group | Weatherford International vs. RPC Inc | Weatherford International vs. NOV Inc | Weatherford International vs. Oceaneering International |
| Bristow vs. Weatherford International PLC | Bristow vs. NOV Inc | Bristow vs. Liberty Oilfield Services | Bristow vs. TechnipFMC PLC |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |