Correlation Between Earthstone Energy and Antero Resources
Can any of the company-specific risk be diversified away by investing in both Earthstone Energy and Antero 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 Earthstone Energy and Antero Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Earthstone Energy and Antero Resources Corp, you can compare the effects of market volatilities on Earthstone Energy and Antero 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 Earthstone Energy with a short position of Antero Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Earthstone Energy and Antero Resources.
Diversification Opportunities for Earthstone Energy and Antero Resources
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Earthstone and Antero is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Earthstone Energy and Antero Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antero Resources Corp and Earthstone 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 Earthstone Energy are associated (or correlated) with Antero Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antero Resources Corp has no effect on the direction of Earthstone Energy i.e., Earthstone Energy and Antero Resources go up and down completely randomly.
Pair Corralation between Earthstone Energy and Antero Resources
If you would invest 2,746 in Antero Resources Corp on January 24, 2024 and sell it today you would earn a total of 291.00 from holding Antero Resources Corp or generate 10.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Earthstone Energy vs. Antero Resources Corp
Performance |
| Timeline |
| Earthstone Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Antero Resources Corp |
Earthstone Energy and Antero Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Earthstone Energy and Antero Resources
The main advantage of trading using opposite Earthstone Energy and Antero Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Earthstone Energy position performs unexpectedly, Antero 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 Antero Resources will offset losses from the drop in Antero Resources' long position.| Earthstone Energy vs. Vital Energy | Earthstone Energy vs. Comstock Resources | Earthstone Energy vs. Magnolia Oil Gas | Earthstone Energy vs. Obsidian Energy |
| Antero Resources vs. Southwestern Energy | Antero Resources vs. Chesapeake Energy Corp | Antero Resources vs. EQT Corporation | Antero Resources vs. Matador Resources |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |