Correlation Between Nabors Industries and Clontarf Energy

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

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

Diversification Opportunities for Nabors Industries and Clontarf Energy

-0.48

Correlation Coefficient

Nabors Industries  Clontarf Energy

Very good diversification

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

Pair Corralation between Nabors Industries and Clontarf Energy

Considering the 90-day investment horizon Nabors Industries is expected to under-perform the Clontarf Energy. But the stock apears to be less risky and, when comparing its historical volatility, Nabors Industries is 2.75 times less risky than Clontarf Energy. The stock trades about -0.03 of its potential returns per unit of risk. The Clontarf Energy Plc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  6.50  in Clontarf Energy Plc on September 12, 2024 and sell it today you would lose (3.10) from holding Clontarf Energy Plc or give up 47.69% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	99.4%
Values	Daily Returns

Nabors Industries  vs.  Clontarf Energy Plc

Nabors Industries

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nabors Industries are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak fundamental drivers, Nabors Industries may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Clontarf Energy Plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Clontarf Energy Plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic 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 Nabors Industries and Clontarf Energy

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

The idea behind Nabors Industries and Clontarf Energy Plc 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.