Correlation Between GulfSlope Energy and Aspen

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

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

Diversification Opportunities for GulfSlope Energy and Aspen

0.0

Correlation Coefficient

GulfSlope Energy  Aspen

Pay attention - limited upside

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

Pair Corralation between GulfSlope Energy and Aspen

If you would invest (100.00) in Aspen Group on December 26, 2024 and sell it today you would earn a total of  100.00  from holding Aspen Group 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

GulfSlope Energy  vs.  Aspen Group

GulfSlope Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days GulfSlope Energy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, GulfSlope Energy is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Aspen Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aspen Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Aspen is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with GulfSlope Energy and Aspen

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

The idea behind GulfSlope Energy and Aspen Group 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.