Correlation Between BKV and Helmerich

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

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

Diversification Opportunities for BKV and Helmerich

-0.01

Correlation Coefficient

BKV  Helmerich

Good diversification

The 3 months correlation between BKV and Helmerich is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding BKV Corp. and Helmerich and Payne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helmerich and Payne and BKV 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 BKV Corporation are associated (or correlated) with Helmerich. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helmerich and Payne has no effect on the direction of BKV i.e., BKV and Helmerich go up and down completely randomly.

Pair Corralation between BKV and Helmerich

Considering the 90-day investment horizon BKV Corporation is expected to generate 0.88 times more return on investment than Helmerich. However, BKV Corporation is 1.14 times less risky than Helmerich. It trades about 0.19 of its potential returns per unit of risk. Helmerich and Payne is currently generating about -0.1 per unit of risk. If you would invest  1,836  in BKV Corporation on September 22, 2024 and sell it today you would earn a total of  333.00  from holding BKV Corporation or generate 18.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

BKV Corp.  vs.  Helmerich and Payne

BKV Corporation

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BKV Corporation are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak forward-looking signals, BKV showed solid returns over the last few months and may actually be approaching a breakup point.

Helmerich and Payne

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Helmerich and Payne has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Helmerich is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with BKV and Helmerich

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

The idea behind BKV Corporation and Helmerich and Payne 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..