Correlation Between Pampa Energia and United States
Can any of the company-specific risk be diversified away by investing in both Pampa Energia and United States 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 Pampa Energia and United States into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pampa Energia SA and United States Oil, you can compare the effects of market volatilities on Pampa Energia and United States 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 Pampa Energia with a short position of United States. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pampa Energia and United States.
Diversification Opportunities for Pampa Energia and United States
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pampa and United is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Pampa Energia SA and United States Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United States Oil and Pampa Energia 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 Pampa Energia SA are associated (or correlated) with United States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United States Oil has no effect on the direction of Pampa Energia i.e., Pampa Energia and United States go up and down completely randomly.
Pair Corralation between Pampa Energia and United States
Considering the 90-day investment horizon Pampa Energia SA is expected to generate 2.55 times more return on investment than United States. However, Pampa Energia is 2.55 times more volatile than United States Oil. It trades about 0.01 of its potential returns per unit of risk. United States Oil is currently generating about 0.02 per unit of risk. If you would invest 4,191 in Pampa Energia SA on January 19, 2024 and sell it today you would lose (2.00) from holding Pampa Energia SA or give up 0.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Pampa Energia SA vs. United States Oil
Performance |
| Timeline |
| Pampa Energia SA |
| United States Oil |
Pampa Energia and United States Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pampa Energia and United States
The main advantage of trading using opposite Pampa Energia and United States positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pampa Energia position performs unexpectedly, United States 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 United States will offset losses from the drop in United States' long position.| Pampa Energia vs. AGL Energy | Pampa Energia vs. Power Assets Holdings | Pampa Energia vs. Maxim Power Corp | Pampa Energia vs. Huaneng Power International |
| United States vs. United States Natural | United States vs. SPDR Gold Shares | United States vs. ProShares Ultra Bloomberg | United States vs. Energy Select Sector |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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