Correlation Between PXP Energy and Concepcion Industrial

Can any of the company-specific risk be diversified away by investing in both PXP Energy and Concepcion Industrial 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 PXP Energy and Concepcion Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PXP Energy Corp and Concepcion Industrial Corp, you can compare the effects of market volatilities on PXP Energy and Concepcion Industrial 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 PXP Energy with a short position of Concepcion Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of PXP Energy and Concepcion Industrial.

Diversification Opportunities for PXP Energy and Concepcion Industrial

0.0

Correlation Coefficient

PXP Energy  Concepcion Industrial

Pay attention - limited upside

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

Pair Corralation between PXP Energy and Concepcion Industrial

If you would invest  0.00  in PXP Energy Corp on October 8, 2024 and sell it today you would earn a total of  0.00  from holding PXP Energy Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	7.14%
Values	Daily Returns

PXP Energy Corp  vs.  Concepcion Industrial Corp

PXP Energy Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Concepcion Industrial

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with PXP Energy and Concepcion Industrial

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

The idea behind PXP Energy Corp and Concepcion Industrial Corp 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.