Correlation Between PEDEVCO Corp and Tullow Oil
Can any of the company-specific risk be diversified away by investing in both PEDEVCO Corp and Tullow 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 PEDEVCO Corp and Tullow Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PEDEVCO Corp and Tullow Oil PLC, you can compare the effects of market volatilities on PEDEVCO Corp and Tullow 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 PEDEVCO Corp with a short position of Tullow Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of PEDEVCO Corp and Tullow Oil.
Diversification Opportunities for PEDEVCO Corp and Tullow Oil
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PEDEVCO and Tullow is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding PEDEVCO Corp and Tullow Oil PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tullow Oil PLC and PEDEVCO Corp 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 PEDEVCO Corp are associated (or correlated) with Tullow Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tullow Oil PLC has no effect on the direction of PEDEVCO Corp i.e., PEDEVCO Corp and Tullow Oil go up and down completely randomly.
Pair Corralation between PEDEVCO Corp and Tullow Oil
Considering the 90-day investment horizon PEDEVCO Corp is expected to under-perform the Tullow Oil. But the stock apears to be less risky and, when comparing its historical volatility, PEDEVCO Corp is 2.09 times less risky than Tullow Oil. The stock trades about -0.06 of its potential returns per unit of risk. The Tullow Oil PLC is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 14.00 in Tullow Oil PLC on December 3, 2024 and sell it today you would lose (2.00) from holding Tullow Oil PLC or give up 14.29% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
PEDEVCO Corp vs. Tullow Oil PLC
Performance |
Timeline |
PEDEVCO Corp |
Tullow Oil PLC |
PEDEVCO Corp and Tullow Oil Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PEDEVCO Corp and Tullow Oil
The main advantage of trading using opposite PEDEVCO Corp and Tullow Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PEDEVCO Corp position performs unexpectedly, Tullow 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 Tullow Oil will offset losses from the drop in Tullow Oil's long position.PEDEVCO Corp vs. Gran Tierra Energy | PEDEVCO Corp vs. Permian Resources | PEDEVCO Corp vs. PermRock Royalty Trust | PEDEVCO Corp vs. MV Oil Trust |
Tullow Oil vs. San Leon Energy | Tullow Oil vs. Dno ASA | Tullow Oil vs. PetroShale | Tullow Oil vs. Horizon Oil Limited |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |