Correlation Between Altura Energy and Petrus Resources

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

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

Diversification Opportunities for Altura Energy and Petrus Resources

0.0

Correlation Coefficient

Altura Energy  Petrus Resources

Pay attention - limited upside

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

Pair Corralation between Altura Energy and Petrus Resources

Assuming the 90 days horizon Altura Energy is expected to generate 1.49 times more return on investment than Petrus Resources. However, Altura Energy is 1.49 times more volatile than Petrus Resources. It trades about 0.02 of its potential returns per unit of risk. Petrus Resources is currently generating about -0.07 per unit of risk. If you would invest  905.00  in Altura Energy on December 29, 2024 and sell it today you would earn a total of  4.00  from holding Altura Energy or generate 0.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Altura Energy  vs.  Petrus Resources

Altura Energy

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Altura Energy are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Altura Energy is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Petrus Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days Petrus Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Altura Energy and Petrus Resources

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

The idea behind Altura Energy and Petrus Resources 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.