Correlation Between Civeo Corp and TrueBlue

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

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

Diversification Opportunities for Civeo Corp and TrueBlue

-0.02

Correlation Coefficient

Civeo Corp  TrueBlue

Good diversification

The 3 months correlation between Civeo and TrueBlue is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Civeo Corp and TrueBlue in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TrueBlue 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 TrueBlue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TrueBlue has no effect on the direction of Civeo Corp i.e., Civeo Corp and TrueBlue go up and down completely randomly.

Pair Corralation between Civeo Corp and TrueBlue

Given the investment horizon of 90 days Civeo Corp is expected to under-perform the TrueBlue. But the stock apears to be less risky and, when comparing its historical volatility, Civeo Corp is 1.79 times less risky than TrueBlue. The stock trades about -0.16 of its potential returns per unit of risk. The TrueBlue is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  766.00  in TrueBlue on September 13, 2024 and sell it today you would earn a total of  127.00  from holding TrueBlue or generate 16.58% return on investment over 90 days.

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

Civeo Corp  vs.  TrueBlue

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 weak 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.

TrueBlue

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in TrueBlue are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak fundamental drivers, TrueBlue demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Civeo Corp and TrueBlue

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

The idea behind Civeo Corp and TrueBlue 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.