Correlation Between XCana Petroleum and A1
Can any of the company-specific risk be diversified away by investing in both XCana Petroleum and A1 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 XCana Petroleum and A1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XCana Petroleum and A1 Group, you can compare the effects of market volatilities on XCana Petroleum and A1 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 XCana Petroleum with a short position of A1. Check out your portfolio center. Please also check ongoing floating volatility patterns of XCana Petroleum and A1.
Diversification Opportunities for XCana Petroleum and A1
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between XCana and A1 is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding XCana Petroleum and A1 Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A1 Group and XCana 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 XCana Petroleum are associated (or correlated) with A1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A1 Group has no effect on the direction of XCana Petroleum i.e., XCana Petroleum and A1 go up and down completely randomly.
Pair Corralation between XCana Petroleum and A1
Given the investment horizon of 90 days XCana Petroleum is expected to generate 1.48 times more return on investment than A1. However, XCana Petroleum is 1.48 times more volatile than A1 Group. It trades about 0.05 of its potential returns per unit of risk. A1 Group is currently generating about -0.11 per unit of risk. If you would invest 5.04 in XCana Petroleum on August 27, 2024 and sell it today you would lose (2.44) from holding XCana Petroleum or give up 48.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XCana Petroleum vs. A1 Group
Performance |
| Timeline |
| XCana Petroleum |
| A1 Group |
XCana Petroleum and A1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XCana Petroleum and A1
The main advantage of trading using opposite XCana Petroleum and A1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XCana Petroleum position performs unexpectedly, A1 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 A1 will offset losses from the drop in A1's long position.| XCana Petroleum vs. Xtra Energy Corp | XCana Petroleum vs. A1 Group | XCana Petroleum vs. New Generation Consumer | XCana Petroleum vs. Palayan Resources |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |