Correlation Between Ranger Oil and Canadian Natural

Can any of the company-specific risk be diversified away by investing in both Ranger Oil and Canadian Natural 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 Ranger Oil and Canadian Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ranger Oil Corp and Canadian Natural Resources, you can compare the effects of market volatilities on Ranger Oil and Canadian Natural 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 Ranger Oil with a short position of Canadian Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ranger Oil and Canadian Natural.

Diversification Opportunities for Ranger Oil and Canadian Natural

0.26

Correlation Coefficient

Ranger Oil  Canadian Natural

Modest diversification

The 3 months correlation between Ranger and Canadian is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Ranger Oil Corp and Canadian Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Natural Res and Ranger Oil 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 Ranger Oil Corp are associated (or correlated) with Canadian Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Natural Res has no effect on the direction of Ranger Oil i.e., Ranger Oil and Canadian Natural go up and down completely randomly.

Pair Corralation between Ranger Oil and Canadian Natural

If you would invest  3,747  in Ranger Oil Corp on October 12, 2024 and sell it today you would earn a total of  0.00  from holding Ranger Oil Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.64%
Values	Daily Returns

Ranger Oil Corp  vs.  Canadian Natural Resources

Ranger Oil Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Canadian Natural Res

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Canadian Natural Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Ranger Oil and Canadian Natural

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

The idea behind Ranger Oil Corp and Canadian Natural Resources 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.

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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.