Correlation Between Mountainview Energy and Stamper Oil

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

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

Diversification Opportunities for Mountainview Energy and Stamper Oil

0.0

Correlation Coefficient

Mountainview Energy  Stamper Oil

Pay attention - limited upside

The 3 months correlation between Mountainview and Stamper is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mountainview Energy and Stamper Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stamper Oil Gas and Mountainview 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 Mountainview Energy are associated (or correlated) with Stamper Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stamper Oil Gas has no effect on the direction of Mountainview Energy i.e., Mountainview Energy and Stamper Oil go up and down completely randomly.

Pair Corralation between Mountainview Energy and Stamper Oil

If you would invest  3.91  in Stamper Oil Gas on September 23, 2024 and sell it today you would lose (2.91) from holding Stamper Oil Gas or give up 74.42% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.48%
Values	Daily Returns

Mountainview Energy  vs.  Stamper Oil Gas

Mountainview Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mountainview Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Mountainview Energy is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Stamper Oil Gas

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Stamper Oil Gas has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Stamper Oil is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Mountainview Energy and Stamper Oil

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

The idea behind Mountainview Energy and Stamper Oil Gas 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.

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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.