Correlation Between Calfrac Well and Jutal Offshore

Can any of the company-specific risk be diversified away by investing in both Calfrac Well and Jutal Offshore 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 Calfrac Well and Jutal Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Calfrac Well Services and Jutal Offshore Oil, you can compare the effects of market volatilities on Calfrac Well and Jutal Offshore 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 Calfrac Well with a short position of Jutal Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calfrac Well and Jutal Offshore.

Diversification Opportunities for Calfrac Well and Jutal Offshore

-0.25

Correlation Coefficient

Calfrac Well  Jutal Offshore

Very good diversification

The 3 months correlation between Calfrac and Jutal is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Calfrac Well Services and Jutal Offshore Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jutal Offshore Oil and Calfrac Well 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 Calfrac Well Services are associated (or correlated) with Jutal Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jutal Offshore Oil has no effect on the direction of Calfrac Well i.e., Calfrac Well and Jutal Offshore go up and down completely randomly.

Pair Corralation between Calfrac Well and Jutal Offshore

Assuming the 90 days horizon Calfrac Well Services is expected to under-perform the Jutal Offshore. In addition to that, Calfrac Well is 1.69 times more volatile than Jutal Offshore Oil. It trades about -0.07 of its total potential returns per unit of risk. Jutal Offshore Oil is currently generating about 0.12 per unit of volatility. If you would invest  1,910  in Jutal Offshore Oil on September 25, 2024 and sell it today you would earn a total of  171.00  from holding Jutal Offshore Oil or generate 8.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Calfrac Well Services  vs.  Jutal Offshore Oil

Calfrac Well Services

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calfrac Well Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Jutal Offshore Oil

Risk-Adjusted Performance

9 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jutal Offshore Oil are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Jutal Offshore may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Calfrac Well and Jutal Offshore

The main advantage of trading using opposite Calfrac Well and Jutal Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calfrac Well position performs unexpectedly, Jutal Offshore 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 Jutal Offshore will offset losses from the drop in Jutal Offshore's long position.

The idea behind Calfrac Well Services and Jutal Offshore Oil pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.