Correlation Between Stampede Drilling and Ensign Energy

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

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

Diversification Opportunities for Stampede Drilling and Ensign Energy

-0.12

Correlation Coefficient

Stampede Drilling  Ensign Energy

Good diversification

The 3 months correlation between Stampede and Ensign is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Stampede Drilling and Ensign Energy Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensign Energy Services and Stampede Drilling 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 Stampede Drilling are associated (or correlated) with Ensign Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensign Energy Services has no effect on the direction of Stampede Drilling i.e., Stampede Drilling and Ensign Energy go up and down completely randomly.

Pair Corralation between Stampede Drilling and Ensign Energy

Assuming the 90 days horizon Stampede Drilling is expected to under-perform the Ensign Energy. In addition to that, Stampede Drilling is 1.21 times more volatile than Ensign Energy Services. It trades about -0.01 of its total potential returns per unit of risk. Ensign Energy Services is currently generating about 0.07 per unit of volatility. If you would invest  210.00  in Ensign Energy Services on October 6, 2024 and sell it today you would earn a total of  109.00  from holding Ensign Energy Services or generate 51.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Stampede Drilling  vs.  Ensign Energy Services

Stampede Drilling

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Stampede Drilling has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Ensign Energy Services

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ensign Energy Services are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, Ensign Energy displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Stampede Drilling and Ensign Energy

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

The idea behind Stampede Drilling and Ensign Energy Services 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.