Correlation Between Brooge Holdings and Seapeak LLC

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

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

Diversification Opportunities for Brooge Holdings and Seapeak LLC

0.2

Correlation Coefficient

Brooge Holdings  Seapeak LLC

Modest diversification

The 3 months correlation between Brooge and Seapeak is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Brooge Holdings and Seapeak LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seapeak LLC and Brooge Holdings 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 Brooge Holdings are associated (or correlated) with Seapeak LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seapeak LLC has no effect on the direction of Brooge Holdings i.e., Brooge Holdings and Seapeak LLC go up and down completely randomly.

Pair Corralation between Brooge Holdings and Seapeak LLC

Given the investment horizon of 90 days Brooge Holdings is expected to generate 2.72 times less return on investment than Seapeak LLC. In addition to that, Brooge Holdings is 7.54 times more volatile than Seapeak LLC. It trades about 0.0 of its total potential returns per unit of risk. Seapeak LLC is currently generating about 0.07 per unit of volatility. If you would invest  2,509  in Seapeak LLC on December 30, 2024 and sell it today you would earn a total of  95.00  from holding Seapeak LLC or generate 3.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Brooge Holdings  vs.  Seapeak LLC

Brooge Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Brooge Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Brooge Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Seapeak LLC

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Seapeak LLC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, Seapeak LLC is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Brooge Holdings and Seapeak LLC

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

The idea behind Brooge Holdings and Seapeak LLC 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.