Correlation Between Boeing and Stamper Oil

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

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

Diversification Opportunities for Boeing and Stamper Oil

-0.39

Correlation Coefficient

Boeing  Stamper Oil

Very good diversification

The 3 months correlation between Boeing and Stamper is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing 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 Boeing 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 The Boeing 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 Boeing i.e., Boeing and Stamper Oil go up and down completely randomly.

Pair Corralation between Boeing and Stamper Oil

Allowing for the 90-day total investment horizon The Boeing is expected to under-perform the Stamper Oil. But the stock apears to be less risky and, when comparing its historical volatility, The Boeing is 31.76 times less risky than Stamper Oil. The stock trades about -0.01 of its potential returns per unit of risk. The Stamper Oil Gas is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  23.00  in Stamper Oil Gas on October 4, 2024 and sell it today you would lose (22.00) from holding Stamper Oil Gas or give up 95.65% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

The Boeing  vs.  Stamper Oil Gas

Boeing

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in The Boeing are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Boeing may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Stamper Oil Gas

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Stamper Oil Gas are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Stamper Oil reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Boeing and Stamper Oil

The main advantage of trading using opposite Boeing and Stamper Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing 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 The Boeing 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.