Correlation Between US Silica and ProPetro Holding
Can any of the company-specific risk be diversified away by investing in both US Silica and ProPetro Holding 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 US Silica and ProPetro Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Silica Holdings and ProPetro Holding Corp, you can compare the effects of market volatilities on US Silica and ProPetro Holding 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 US Silica with a short position of ProPetro Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Silica and ProPetro Holding.
Diversification Opportunities for US Silica and ProPetro Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SLCA and ProPetro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding US Silica Holdings and ProPetro Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProPetro Holding Corp and US Silica 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 US Silica Holdings are associated (or correlated) with ProPetro Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProPetro Holding Corp has no effect on the direction of US Silica i.e., US Silica and ProPetro Holding go up and down completely randomly.
Pair Corralation between US Silica and ProPetro Holding
If you would invest 741.00 in ProPetro Holding Corp on December 7, 2024 and sell it today you would earn a total of 7.00 from holding ProPetro Holding Corp or generate 0.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
US Silica Holdings vs. ProPetro Holding Corp
Performance |
Timeline |
US Silica Holdings |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
ProPetro Holding Corp |
US Silica and ProPetro Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with US Silica and ProPetro Holding
The main advantage of trading using opposite US Silica and ProPetro Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Silica position performs unexpectedly, ProPetro Holding 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 ProPetro Holding will offset losses from the drop in ProPetro Holding's long position.US Silica vs. North American Construction | US Silica vs. ProPetro Holding Corp | US Silica vs. Ranger Energy Services | US Silica vs. Cactus Inc |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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