Correlation Between EQT and Yuma Energy

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Can any of the company-specific risk be diversified away by investing in both EQT and Yuma 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 EQT and Yuma Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EQT Corporation and Yuma Energy, you can compare the effects of market volatilities on EQT and Yuma 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 EQT with a short position of Yuma Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of EQT and Yuma Energy.

Diversification Opportunities for EQT and Yuma Energy

0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between EQT and Yuma Energy

If you would invest  3,426  in EQT Corporation on September 6, 2024 and sell it today you would earn a total of  1,043  from holding EQT Corporation or generate 30.44% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.25%
ValuesDaily Returns

EQT Corp.  vs.  Yuma Energy

 Performance 
       Timeline  
EQT Corporation 

Risk-Adjusted Performance

19 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in EQT Corporation are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, EQT unveiled solid returns over the last few months and may actually be approaching a breakup point.
Yuma Energy 

Risk-Adjusted Performance

0 of 100

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

EQT and Yuma Energy Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with EQT and Yuma Energy

The main advantage of trading using opposite EQT and Yuma Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EQT position performs unexpectedly, Yuma 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 Yuma Energy will offset losses from the drop in Yuma Energy's long position.
The idea behind EQT Corporation and Yuma Energy 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.

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