Correlation Between Select Energy and CCC

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Can any of the company-specific risk be diversified away by investing in both Select Energy and CCC 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 Select Energy and CCC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Select Energy Services and CCC, you can compare the effects of market volatilities on Select Energy and CCC 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 Select Energy with a short position of CCC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Select Energy and CCC.

Diversification Opportunities for Select Energy and CCC

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Select and CCC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Select Energy Services and CCC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCC and Select 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 Select Energy Services are associated (or correlated) with CCC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCC has no effect on the direction of Select Energy i.e., Select Energy and CCC go up and down completely randomly.

Pair Corralation between Select Energy and CCC

If you would invest  853.00  in Select Energy Services on December 30, 2023 and sell it today you would earn a total of  70.00  from holding Select Energy Services or generate 8.21% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Select Energy Services  vs.  CCC

 Performance 
       Timeline  
Select Energy Services 

Risk-Adjusted Performance

11 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Select Energy Services are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Select Energy reported solid returns over the last few months and may actually be approaching a breakup point.
CCC 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days CCC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, CCC is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Select Energy and CCC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Select Energy and CCC

The main advantage of trading using opposite Select Energy and CCC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Select Energy position performs unexpectedly, CCC 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 CCC will offset losses from the drop in CCC's long position.
The idea behind Select Energy Services and CCC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

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