Correlation Between Helix Energy and ProPetro Holding

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

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

Diversification Opportunities for Helix Energy and ProPetro Holding

0.59

Correlation Coefficient

Helix Energy  ProPetro Holding

Very weak diversification

The 3 months correlation between Helix and ProPetro is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Helix Energy Solutions and ProPetro Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProPetro Holding Corp and Helix 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 Helix Energy Solutions are associated (or correlated) with ProPetro Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProPetro Holding Corp has no effect on the direction of Helix Energy i.e., Helix Energy and ProPetro Holding go up and down completely randomly.

Pair Corralation between Helix Energy and ProPetro Holding

Considering the 90-day investment horizon Helix Energy Solutions is expected to generate 0.9 times more return on investment than ProPetro Holding. However, Helix Energy Solutions is 1.11 times less risky than ProPetro Holding. It trades about -0.03 of its potential returns per unit of risk. ProPetro Holding Corp is currently generating about -0.11 per unit of risk. If you would invest  917.00  in Helix Energy Solutions on December 29, 2024 and sell it today you would lose (63.00) from holding Helix Energy Solutions or give up 6.87% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Helix Energy Solutions  vs.  ProPetro Holding Corp

Helix Energy Solutions

Risk-Adjusted Performance

Very Weak

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

ProPetro Holding Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days ProPetro Holding Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's primary indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Helix Energy and ProPetro Holding

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

The idea behind Helix Energy Solutions and ProPetro Holding Corp 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.