Correlation Between ION Geophysical and Schlumberger
Can any of the company-specific risk be diversified away by investing in both ION Geophysical and Schlumberger 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 ION Geophysical and Schlumberger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ION Geophysical and Schlumberger NV, you can compare the effects of market volatilities on ION Geophysical and Schlumberger 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 ION Geophysical with a short position of Schlumberger. Check out your portfolio center. Please also check ongoing floating volatility patterns of ION Geophysical and Schlumberger.
Diversification Opportunities for ION Geophysical and Schlumberger
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ION and Schlumberger is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding ION Geophysical and Schlumberger NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schlumberger NV and ION Geophysical 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 ION Geophysical are associated (or correlated) with Schlumberger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schlumberger NV has no effect on the direction of ION Geophysical i.e., ION Geophysical and Schlumberger go up and down completely randomly.
Pair Corralation between ION Geophysical and Schlumberger
If you would invest 7.10 in ION Geophysical on January 24, 2024 and sell it today you would earn a total of 0.00 from holding ION Geophysical or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 1.59% |
| Values | Daily Returns |
ION Geophysical vs. Schlumberger NV
Performance |
| Timeline |
| ION Geophysical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Schlumberger NV |
ION Geophysical and Schlumberger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ION Geophysical and Schlumberger
The main advantage of trading using opposite ION Geophysical and Schlumberger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ION Geophysical position performs unexpectedly, Schlumberger 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 Schlumberger will offset losses from the drop in Schlumberger's long position.| ION Geophysical vs. SL Green Realty | ION Geophysical vs. Yuexiu Real Estate | ION Geophysical vs. Mid Atlantic Home Health | ION Geophysical vs. Kite Realty Group |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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