Correlation Between Cheetah Oil and Aftermaster

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

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

Diversification Opportunities for Cheetah Oil and Aftermaster

-0.33

Correlation Coefficient

Cheetah Oil  Aftermaster

Very good diversification

The 3 months correlation between Cheetah and Aftermaster is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Cheetah Oil Gas and Aftermaster in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aftermaster and Cheetah Oil 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 Cheetah Oil Gas are associated (or correlated) with Aftermaster. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aftermaster has no effect on the direction of Cheetah Oil i.e., Cheetah Oil and Aftermaster go up and down completely randomly.

Pair Corralation between Cheetah Oil and Aftermaster

If you would invest  0.02  in Cheetah Oil Gas on December 30, 2024 and sell it today you would earn a total of  0.00  from holding Cheetah Oil Gas or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.38%
Values	Daily Returns

Cheetah Oil Gas  vs.  Aftermaster

Cheetah Oil Gas

Risk-Adjusted Performance

Very Weak

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

Aftermaster

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aftermaster has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Cheetah Oil and Aftermaster

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

The idea behind Cheetah Oil Gas and Aftermaster 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.