Correlation Between Civeo Corp and Hirequest

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

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

Diversification Opportunities for Civeo Corp and Hirequest

-0.48

Correlation Coefficient

Civeo Corp  Hirequest

Very good diversification

The 3 months correlation between Civeo and Hirequest is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Civeo Corp and Hirequest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hirequest and Civeo Corp 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 Civeo Corp are associated (or correlated) with Hirequest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hirequest has no effect on the direction of Civeo Corp i.e., Civeo Corp and Hirequest go up and down completely randomly.

Pair Corralation between Civeo Corp and Hirequest

Given the investment horizon of 90 days Civeo Corp is expected to under-perform the Hirequest. But the stock apears to be less risky and, when comparing its historical volatility, Civeo Corp is 1.4 times less risky than Hirequest. The stock trades about -0.15 of its potential returns per unit of risk. The Hirequest is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1,402  in Hirequest on September 5, 2024 and sell it today you would earn a total of  119.00  from holding Hirequest or generate 8.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Civeo Corp  vs.  Hirequest

Civeo Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Civeo Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Hirequest

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Hirequest are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Hirequest may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Civeo Corp and Hirequest

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

The idea behind Civeo Corp and Hirequest 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.