Correlation Between Petro Viking and CNX Resources
Can any of the company-specific risk be diversified away by investing in both Petro Viking and CNX Resources 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 CNX Resources 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 CNX Resources Corp, you can compare the effects of market volatilities on Petro Viking and CNX Resources 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 CNX Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petro Viking and CNX Resources.
Diversification Opportunities for Petro Viking and CNX Resources
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Petro and CNX is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Petro Viking Energy and CNX Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNX Resources Corp 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 CNX Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNX Resources Corp has no effect on the direction of Petro Viking i.e., Petro Viking and CNX Resources go up and down completely randomly.
Pair Corralation between Petro Viking and CNX Resources
Assuming the 90 days horizon Petro Viking Energy is expected to generate 48.5 times more return on investment than CNX Resources. However, Petro Viking is 48.5 times more volatile than CNX Resources Corp. It trades about 0.18 of its potential returns per unit of risk. CNX Resources Corp is currently generating about -0.19 per unit of risk. If you would invest 0.13 in Petro Viking Energy on December 2, 2024 and sell it today you would earn a total of 0.23 from holding Petro Viking Energy or generate 176.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 96.83% |
Values | Daily Returns |
Petro Viking Energy vs. CNX Resources Corp
Performance |
Timeline |
Petro Viking Energy |
CNX Resources Corp |
Petro Viking and CNX Resources Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Petro Viking and CNX Resources
The main advantage of trading using opposite Petro Viking and CNX Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petro Viking position performs unexpectedly, CNX Resources 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 CNX Resources will offset losses from the drop in CNX Resources' long position.Petro Viking vs. Otto Energy Limited | Petro Viking vs. Foothills Exploration | Petro Viking vs. MMEX Resources Corp | Petro Viking vs. 1st NRG Corp |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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