Correlation Between Barrister Energy and Rockdale Resources

Can any of the company-specific risk be diversified away by investing in both Barrister Energy and Rockdale 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 Barrister Energy and Rockdale Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Barrister Energy LLC and Rockdale Resources Corp, you can compare the effects of market volatilities on Barrister Energy and Rockdale 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 Barrister Energy with a short position of Rockdale Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barrister Energy and Rockdale Resources.

Diversification Opportunities for Barrister Energy and Rockdale Resources

-0.97

Correlation Coefficient

Barrister Energy  Rockdale Resources

Pay attention - limited upside

The 3 months correlation between Barrister and Rockdale is -0.97. Overlapping area represents the amount of risk that can be diversified away by holding Barrister Energy LLC and Rockdale Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rockdale Resources Corp and Barrister Energy 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 Barrister Energy LLC are associated (or correlated) with Rockdale Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rockdale Resources Corp has no effect on the direction of Barrister Energy i.e., Barrister Energy and Rockdale Resources go up and down completely randomly.

Pair Corralation between Barrister Energy and Rockdale Resources

Given the investment horizon of 90 days Barrister Energy LLC is expected to generate 0.06 times more return on investment than Rockdale Resources. However, Barrister Energy LLC is 17.33 times less risky than Rockdale Resources. It trades about 0.13 of its potential returns per unit of risk. Rockdale Resources Corp is currently generating about -0.17 per unit of risk. If you would invest  200.00  in Barrister Energy LLC on September 3, 2024 and sell it today you would earn a total of  15.00  from holding Barrister Energy LLC or generate 7.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	56.25%
Values	Daily Returns

Barrister Energy LLC  vs.  Rockdale Resources Corp

Barrister Energy LLC

Risk-Adjusted Performance

9 of 100

OK

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

Rockdale Resources Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rockdale Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's essential indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Barrister Energy and Rockdale Resources

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

The idea behind Barrister Energy LLC and Rockdale Resources Corp 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.