Correlation Between Gran Tierra and Vivakor

Can any of the company-specific risk be diversified away by investing in both Gran Tierra and Vivakor 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 Gran Tierra and Vivakor into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gran Tierra Energy and Vivakor, you can compare the effects of market volatilities on Gran Tierra and Vivakor 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 Gran Tierra with a short position of Vivakor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gran Tierra and Vivakor.

Diversification Opportunities for Gran Tierra and Vivakor

-0.07

Correlation Coefficient

Gran Tierra  Vivakor

Good diversification

The 3 months correlation between Gran and Vivakor is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Gran Tierra Energy and Vivakor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vivakor and Gran Tierra 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 Gran Tierra Energy are associated (or correlated) with Vivakor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vivakor has no effect on the direction of Gran Tierra i.e., Gran Tierra and Vivakor go up and down completely randomly.

Pair Corralation between Gran Tierra and Vivakor

Considering the 90-day investment horizon Gran Tierra is expected to generate 1.17 times less return on investment than Vivakor. But when comparing it to its historical volatility, Gran Tierra Energy is 2.5 times less risky than Vivakor. It trades about 0.25 of its potential returns per unit of risk. Vivakor is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  102.00  in Vivakor on January 26, 2024 and sell it today you would earn a total of  48.00  from holding Vivakor or generate 47.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Gran Tierra Energy  vs.  Vivakor

Gran Tierra Energy

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Gran Tierra Energy are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Gran Tierra exhibited solid returns over the last few months and may actually be approaching a breakup point.

Vivakor

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vivakor are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Vivakor disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gran Tierra and Vivakor

The main advantage of trading using opposite Gran Tierra and Vivakor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gran Tierra position performs unexpectedly, Vivakor 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 Vivakor will offset losses from the drop in Vivakor's long position.

The idea behind Gran Tierra Energy and Vivakor 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.