Correlation Between Imperial Res and Saturn Oil

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

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

Diversification Opportunities for Imperial Res and Saturn Oil

0.0

Correlation Coefficient

Imperial Res  Saturn Oil

Pay attention - limited upside

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

Pair Corralation between Imperial Res and Saturn Oil

If you would invest  0.02  in Imperial Res on December 29, 2024 and sell it today you would earn a total of  0.00  from holding Imperial Res or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Imperial Res  vs.  Saturn Oil Gas

Imperial Res

Risk-Adjusted Performance

Very Weak

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

Saturn Oil Gas

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Imperial Res and Saturn Oil

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

The idea behind Imperial Res and Saturn Oil Gas 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.