Correlation Between Helmerich and SGS SA

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

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

Diversification Opportunities for Helmerich and SGS SA

0.09

Correlation Coefficient

Helmerich  SGS SA

Significant diversification

The 3 months correlation between Helmerich and SGS is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Helmerich and Payne and SGS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGS SA and Helmerich 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 Helmerich and Payne are associated (or correlated) with SGS SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGS SA has no effect on the direction of Helmerich i.e., Helmerich and SGS SA go up and down completely randomly.

Pair Corralation between Helmerich and SGS SA

Allowing for the 90-day total investment horizon Helmerich and Payne is expected to under-perform the SGS SA. In addition to that, Helmerich is 2.31 times more volatile than SGS SA. It trades about -0.08 of its total potential returns per unit of risk. SGS SA is currently generating about 0.01 per unit of volatility. If you would invest  1,008  in SGS SA on October 9, 2024 and sell it today you would earn a total of  2.00  from holding SGS SA or generate 0.2% return on investment over 90 days.

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

Helmerich and Payne  vs.  SGS SA

Helmerich and Payne

Risk-Adjusted Performance

0 of 100

Very Weak

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

SGS SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SGS SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Helmerich and SGS SA

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

The idea behind Helmerich and Payne and SGS SA 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.