Correlation Between Patterson UTI and StandardAero,

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

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

Diversification Opportunities for Patterson UTI and StandardAero,

-0.05

Correlation Coefficient

Patterson UTI  StandardAero,

Good diversification

The 3 months correlation between Patterson and StandardAero, is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Patterson UTI Energy and StandardAero, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on StandardAero, and Patterson UTI 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 Patterson UTI Energy are associated (or correlated) with StandardAero,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of StandardAero, has no effect on the direction of Patterson UTI i.e., Patterson UTI and StandardAero, go up and down completely randomly.

Pair Corralation between Patterson UTI and StandardAero,

Given the investment horizon of 90 days Patterson UTI is expected to generate 18.08 times less return on investment than StandardAero,. But when comparing it to its historical volatility, Patterson UTI Energy is 2.17 times less risky than StandardAero,. It trades about 0.01 of its potential returns per unit of risk. StandardAero, is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,400  in StandardAero, on September 4, 2024 and sell it today you would earn a total of  426.00  from holding StandardAero, or generate 17.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	70.31%
Values	Daily Returns

Patterson UTI Energy  vs.  StandardAero,

Patterson UTI Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Patterson UTI Energy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Patterson UTI is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

StandardAero,

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in StandardAero, are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, StandardAero, displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Patterson UTI and StandardAero,

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

The idea behind Patterson UTI Energy and StandardAero, 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.