Correlation Between EOG Resources and Mitsui
Can any of the company-specific risk be diversified away by investing in both EOG Resources and Mitsui 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 EOG Resources and Mitsui into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EOG Resources and Mitsui Company, you can compare the effects of market volatilities on EOG Resources and Mitsui 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 EOG Resources with a short position of Mitsui. Check out your portfolio center. Please also check ongoing floating volatility patterns of EOG Resources and Mitsui.
Diversification Opportunities for EOG Resources and Mitsui
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EOG and Mitsui is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding EOG Resources and Mitsui Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsui Company and EOG 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 EOG Resources are associated (or correlated) with Mitsui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsui Company has no effect on the direction of EOG Resources i.e., EOG Resources and Mitsui go up and down completely randomly.
Pair Corralation between EOG Resources and Mitsui
Considering the 90-day investment horizon EOG Resources is expected to generate 1.76 times less return on investment than Mitsui. In addition to that, EOG Resources is 1.21 times more volatile than Mitsui Company. It trades about 0.02 of its total potential returns per unit of risk. Mitsui Company is currently generating about 0.05 per unit of volatility. If you would invest 51,633 in Mitsui Company on January 26, 2024 and sell it today you would earn a total of 8,207 from holding Mitsui Company or generate 15.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 38.87% |
Values | Daily Returns |
EOG Resources vs. Mitsui Company
Performance |
Timeline |
EOG Resources |
Mitsui Company |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
EOG Resources and Mitsui Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with EOG Resources and Mitsui
The main advantage of trading using opposite EOG Resources and Mitsui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EOG Resources position performs unexpectedly, Mitsui 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 Mitsui will offset losses from the drop in Mitsui's long position.EOG Resources vs. Pioneer Natural Resources | EOG Resources vs. Permian Resources | EOG Resources vs. Devon Energy | EOG Resources vs. Coterra Energy |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |