Correlation Between Barksdale Resources and Icahn Enterprises
Can any of the company-specific risk be diversified away by investing in both Barksdale Resources and Icahn Enterprises 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 Barksdale Resources and Icahn Enterprises into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barksdale Resources Corp and Icahn Enterprises LP, you can compare the effects of market volatilities on Barksdale Resources and Icahn Enterprises 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 Barksdale Resources with a short position of Icahn Enterprises. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barksdale Resources and Icahn Enterprises.
Diversification Opportunities for Barksdale Resources and Icahn Enterprises
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Barksdale and Icahn is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Barksdale Resources Corp and Icahn Enterprises LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icahn Enterprises and Barksdale Resources 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 Barksdale Resources Corp are associated (or correlated) with Icahn Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icahn Enterprises has no effect on the direction of Barksdale Resources i.e., Barksdale Resources and Icahn Enterprises go up and down completely randomly.
Pair Corralation between Barksdale Resources and Icahn Enterprises
Assuming the 90 days horizon Barksdale Resources Corp is expected to generate 10.97 times more return on investment than Icahn Enterprises. However, Barksdale Resources is 10.97 times more volatile than Icahn Enterprises LP. It trades about 0.19 of its potential returns per unit of risk. Icahn Enterprises LP is currently generating about 0.03 per unit of risk. If you would invest 10.00 in Barksdale Resources Corp on January 25, 2024 and sell it today you would earn a total of 4.00 from holding Barksdale Resources Corp or generate 40.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Barksdale Resources Corp vs. Icahn Enterprises LP
Performance |
Timeline |
Barksdale Resources Corp |
Icahn Enterprises |
Barksdale Resources and Icahn Enterprises Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Barksdale Resources and Icahn Enterprises
The main advantage of trading using opposite Barksdale Resources and Icahn Enterprises positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barksdale Resources position performs unexpectedly, Icahn Enterprises 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 Icahn Enterprises will offset losses from the drop in Icahn Enterprises' long position.Barksdale Resources vs. Churchill Resources | Barksdale Resources vs. Western Troy Capital | Barksdale Resources vs. Beyond Minerals | Barksdale Resources vs. Altius Minerals |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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