Correlation Between Alliance Resource and Rex Energy
Can any of the company-specific risk be diversified away by investing in both Alliance Resource and Rex 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 Alliance Resource and Rex Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alliance Resource Partners and Rex Energy, you can compare the effects of market volatilities on Alliance Resource and Rex 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 Alliance Resource with a short position of Rex Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliance Resource and Rex Energy.
Diversification Opportunities for Alliance Resource and Rex Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alliance and Rex is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alliance Resource Partners and Rex Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rex Energy and Alliance Resource 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 Alliance Resource Partners are associated (or correlated) with Rex Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rex Energy has no effect on the direction of Alliance Resource i.e., Alliance Resource and Rex Energy go up and down completely randomly.
Pair Corralation between Alliance Resource and Rex Energy
If you would invest 1,997 in Alliance Resource Partners on January 26, 2024 and sell it today you would earn a total of 121.00 from holding Alliance Resource Partners or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Alliance Resource Partners vs. Rex Energy
Performance |
| Timeline |
| Alliance Resource |
| Rex Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Alliance Resource and Rex Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliance Resource and Rex Energy
The main advantage of trading using opposite Alliance Resource and Rex Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliance Resource position performs unexpectedly, Rex 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 Rex Energy will offset losses from the drop in Rex Energy's long position.| Alliance Resource vs. NACCO Industries | Alliance Resource vs. Indo Tambangraya Megah | Alliance Resource vs. Adaro Energy Tbk |
| Rex Energy vs. Fidus Investment Corp | Rex Energy vs. Blue Owl Capital | Rex Energy vs. Stepan Company | Rex Energy vs. Golden Energy Offshore |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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