Correlation Between Rex Energy and Adaro Energy
Can any of the company-specific risk be diversified away by investing in both Rex Energy and Adaro 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 Rex Energy and Adaro Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rex Energy and Adaro Energy Tbk, you can compare the effects of market volatilities on Rex Energy and Adaro 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 Rex Energy with a short position of Adaro Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rex Energy and Adaro Energy.
Diversification Opportunities for Rex Energy and Adaro Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Rex and Adaro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Rex Energy and Adaro Energy Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adaro Energy Tbk and Rex Energy 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 Rex Energy are associated (or correlated) with Adaro Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adaro Energy Tbk has no effect on the direction of Rex Energy i.e., Rex Energy and Adaro Energy go up and down completely randomly.
Pair Corralation between Rex Energy and Adaro Energy
If you would invest 767.00 in Adaro Energy Tbk on January 20, 2024 and sell it today you would earn a total of 57.00 from holding Adaro Energy Tbk or generate 7.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Rex Energy vs. Adaro Energy Tbk
Performance |
| Timeline |
| Rex Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Adaro Energy Tbk |
Rex Energy and Adaro Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rex Energy and Adaro Energy
The main advantage of trading using opposite Rex Energy and Adaro Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rex Energy position performs unexpectedly, Adaro 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 Adaro Energy will offset losses from the drop in Adaro Energy's long position.| Rex Energy vs. Transphorm Technology | Rex Energy vs. BRP Inc | Rex Energy vs. United Parks Resorts | Rex Energy vs. Academy Sports OutdoorsInc |
| Adaro Energy vs. Alliance Resource Partners | Adaro Energy vs. Targa Resources | Adaro Energy vs. Entegris | Adaro Energy vs. Trump Media Technology |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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