Correlation Between Whiting Petroleum and California Resources
Can any of the company-specific risk be diversified away by investing in both Whiting Petroleum and California Resources 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 California Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Whiting Petroleum and California Resources, you can compare the effects of market volatilities on Whiting Petroleum and California Resources 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 California Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Whiting Petroleum and California Resources.
Diversification Opportunities for Whiting Petroleum and California Resources
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Whiting and California is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Whiting Petroleum and California Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on California Resources 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 California Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of California Resources has no effect on the direction of Whiting Petroleum i.e., Whiting Petroleum and California Resources go up and down completely randomly.
Pair Corralation between Whiting Petroleum and California Resources
If you would invest 300.00 in Whiting Petroleum on November 29, 2024 and sell it today you would lose (25.00) from holding Whiting Petroleum or give up 8.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Whiting Petroleum vs. California Resources
Performance |
| Timeline |
| Whiting Petroleum |
| California Resources |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Whiting Petroleum and California Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Whiting Petroleum and California Resources
The main advantage of trading using opposite Whiting Petroleum and California Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Whiting Petroleum position performs unexpectedly, California Resources 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 California Resources will offset losses from the drop in California Resources' long position.| Whiting Petroleum vs. Chord Energy Corp | Whiting Petroleum vs. Bristow Group | Whiting Petroleum vs. Pioneer Bancorp |
| California Resources vs. Cardinal Energy | California Resources vs. Spartan Delta Corp | California Resources vs. Delek Group | California Resources vs. Bonterra Energy Corp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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