Correlation Between Petro Viking and Altura Energy

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Can any of the company-specific risk be diversified away by investing in both Petro Viking and Altura Energy 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 Viking and Altura Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petro Viking Energy and Altura Energy, you can compare the effects of market volatilities on Petro Viking and Altura Energy 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 Viking with a short position of Altura Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petro Viking and Altura Energy.

Diversification Opportunities for Petro Viking and Altura Energy

PetroAlturaDiversified AwayPetroAlturaDiversified Away100%
-0.32
  Correlation Coefficient

Very good diversification

The 3 months correlation between Petro and Altura is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Petro Viking Energy and Altura Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altura Energy and Petro Viking 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 Viking Energy are associated (or correlated) with Altura Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altura Energy has no effect on the direction of Petro Viking i.e., Petro Viking and Altura Energy go up and down completely randomly.

Pair Corralation between Petro Viking and Altura Energy

Assuming the 90 days horizon Petro Viking Energy is expected to generate 16.62 times more return on investment than Altura Energy. However, Petro Viking is 16.62 times more volatile than Altura Energy. It trades about 0.11 of its potential returns per unit of risk. Altura Energy is currently generating about 0.1 per unit of risk. If you would invest  16.00  in Petro Viking Energy on November 24, 2024 and sell it today you would lose (15.64) from holding Petro Viking Energy or give up 97.75% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy99.8%
ValuesDaily Returns

Petro Viking Energy  vs.  Altura Energy

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -50050100150200
JavaScript chart by amCharts 3.21.15PTRVF ATUUF
       Timeline  
Petro Viking Energy 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Petro Viking Energy are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Petro Viking reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.00100000000000000340.0020.0040.0060.0080.010.0120.0140.016
Altura Energy 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Altura Energy are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Altura Energy is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb99.51010.51111.5

Petro Viking and Altura Energy Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-470.73-352.56-234.38-116.210.02128.39258.95389.52520.08 0.010.020.030.04
JavaScript chart by amCharts 3.21.15PTRVF ATUUF
       Returns  

Pair Trading with Petro Viking and Altura Energy

The main advantage of trading using opposite Petro Viking and Altura Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petro Viking position performs unexpectedly, Altura Energy 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 Altura Energy will offset losses from the drop in Altura Energy's long position.
The idea behind Petro Viking Energy and Altura Energy 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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