Correlation Between Whiting Petroleum and Bristow
Can any of the company-specific risk be diversified away by investing in both Whiting Petroleum 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 Whiting Petroleum and Bristow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Whiting Petroleum and Bristow Group, you can compare the effects of market volatilities on Whiting Petroleum 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 Whiting Petroleum with a short position of Bristow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Whiting Petroleum and Bristow.
Diversification Opportunities for Whiting Petroleum and Bristow
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Whiting and Bristow is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Whiting Petroleum and Bristow Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bristow Group and Whiting Petroleum 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 Whiting Petroleum 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 Whiting Petroleum i.e., Whiting Petroleum and Bristow go up and down completely randomly.
Pair Corralation between Whiting Petroleum and Bristow
Assuming the 90 days horizon Whiting Petroleum is expected to generate 2.08 times more return on investment than Bristow. However, Whiting Petroleum is 2.08 times more volatile than Bristow Group. It trades about 0.03 of its potential returns per unit of risk. Bristow Group is currently generating about 0.05 per unit of risk. If you would invest 1,850 in Whiting Petroleum on August 27, 2024 and sell it today you would earn a total of 350.00 from holding Whiting Petroleum or generate 18.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 87.9% |
| Values | Daily Returns |
Whiting Petroleum vs. Bristow Group
Performance |
| Timeline |
| Whiting Petroleum |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bristow Group |
Whiting Petroleum and Bristow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Whiting Petroleum and Bristow
The main advantage of trading using opposite Whiting Petroleum and Bristow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Whiting Petroleum 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.| Whiting Petroleum vs. Whiting Petroleum | Whiting Petroleum vs. Chord Energy Corp | Whiting Petroleum vs. Bristow Group | Whiting Petroleum vs. Pioneer Bancorp |
| Bristow vs. Oil States International | Bristow vs. Geospace Technologies | Bristow vs. Weatherford International PLC | Bristow vs. Enerflex |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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