Correlation Between ConocoPhillips and Antero Resources
Can any of the company-specific risk be diversified away by investing in both ConocoPhillips 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 ConocoPhillips and Antero Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ConocoPhillips and Antero Resources Corp, you can compare the effects of market volatilities on ConocoPhillips 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 ConocoPhillips with a short position of Antero Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of ConocoPhillips and Antero Resources.
Diversification Opportunities for ConocoPhillips and Antero Resources
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ConocoPhillips and Antero is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding ConocoPhillips 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 ConocoPhillips 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 ConocoPhillips 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 ConocoPhillips i.e., ConocoPhillips and Antero Resources go up and down completely randomly.
Pair Corralation between ConocoPhillips and Antero Resources
Considering the 90-day investment horizon ConocoPhillips is expected to generate 0.63 times more return on investment than Antero Resources. However, ConocoPhillips is 1.59 times less risky than Antero Resources. It trades about 0.02 of its potential returns per unit of risk. Antero Resources Corp is currently generating about 0.0 per unit of risk. If you would invest 12,087 in ConocoPhillips on January 19, 2024 and sell it today you would earn a total of 719.00 from holding ConocoPhillips or generate 5.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ConocoPhillips vs. Antero Resources Corp
Performance |
| Timeline |
| ConocoPhillips |
| Antero Resources Corp |
ConocoPhillips and Antero Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ConocoPhillips and Antero Resources
The main advantage of trading using opposite ConocoPhillips and Antero Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ConocoPhillips 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.| ConocoPhillips vs. Diamondback Energy | ConocoPhillips vs. Pioneer Natural Resources | ConocoPhillips vs. APA Corporation | ConocoPhillips vs. Hess Corporation |
| 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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