Correlation Between CGX Energy and Barrister Energy

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

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

Diversification Opportunities for CGX Energy and Barrister Energy

0.0

Correlation Coefficient

CGX Energy  Barrister Energy

Pay attention - limited upside

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

Pair Corralation between CGX Energy and Barrister Energy

Assuming the 90 days horizon CGX Energy is expected to under-perform the Barrister Energy. In addition to that, CGX Energy is 1.11 times more volatile than Barrister Energy LLC. It trades about -0.04 of its total potential returns per unit of risk. Barrister Energy LLC is currently generating about 0.03 per unit of volatility. If you would invest  213.00  in Barrister Energy LLC on October 26, 2024 and sell it today you would earn a total of  2.00  from holding Barrister Energy LLC or generate 0.94% return on investment over 90 days.

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

CGX Energy  vs.  Barrister Energy LLC

CGX Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CGX Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Barrister Energy LLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Barrister Energy LLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Barrister Energy is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with CGX Energy and Barrister Energy

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

The idea behind CGX Energy and Barrister Energy 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.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.