Correlation Between Petro Usa and Intl Star

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

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

Diversification Opportunities for Petro Usa and Intl Star

0.0

Correlation Coefficient

Petro Usa  Intl Star

Pay attention - limited upside

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

Pair Corralation between Petro Usa and Intl Star

If you would invest  0.08  in Intl Star on October 5, 2024 and sell it today you would earn a total of  0.00  from holding Intl Star or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Petro Usa  vs.  Intl Star

Petro Usa

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Petro Usa has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady basic indicators, Petro Usa is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Intl Star

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intl Star has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Petro Usa and Intl Star

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

The idea behind Petro Usa and Intl Star 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.