Correlation Between CHK Old and Northern Oil

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

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

Diversification Opportunities for CHK Old and Northern Oil

0.0

Correlation Coefficient

CHK Old  Northern Oil

Pay attention - limited upside

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

Pair Corralation between CHK Old and Northern Oil

If you would invest (100.00) in CHK Old on December 30, 2024 and sell it today you would earn a total of  100.00  from holding CHK Old or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CHK Old  vs.  Northern Oil Gas

CHK Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days CHK Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical indicators, CHK Old is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Northern Oil Gas

Risk-Adjusted Performance

Very Weak

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

Pair Trading with CHK Old and Northern Oil

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

The idea behind CHK Old and Northern 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..