Correlation Between Occidental Petroleum and Expand Energy
Can any of the company-specific risk be diversified away by investing in both Occidental Petroleum and Expand 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 Occidental Petroleum and Expand Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Occidental Petroleum and Expand Energy, you can compare the effects of market volatilities on Occidental Petroleum and Expand 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 Occidental Petroleum with a short position of Expand Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Occidental Petroleum and Expand Energy.
Diversification Opportunities for Occidental Petroleum and Expand Energy
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Occidental and Expand is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Occidental Petroleum and Expand Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expand Energy and Occidental Petroleum 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 Occidental Petroleum are associated (or correlated) with Expand Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expand Energy has no effect on the direction of Occidental Petroleum i.e., Occidental Petroleum and Expand Energy go up and down completely randomly.
Pair Corralation between Occidental Petroleum and Expand Energy
Considering the 90-day investment horizon Occidental Petroleum is expected to under-perform the Expand Energy. In addition to that, Occidental Petroleum is 49.64 times more volatile than Expand Energy. It trades about -0.03 of its total potential returns per unit of risk. Expand Energy is currently generating about -0.12 per unit of volatility. If you would invest 9,730 in Expand Energy on August 13, 2025 and sell it today you would lose (30.00) from holding Expand Energy or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Occidental Petroleum vs. Expand Energy
Performance |
| Timeline |
| Occidental Petroleum |
| Expand Energy |
Occidental Petroleum and Expand Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Occidental Petroleum and Expand Energy
The main advantage of trading using opposite Occidental Petroleum and Expand Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Occidental Petroleum position performs unexpectedly, Expand 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 Expand Energy will offset losses from the drop in Expand Energy's long position.| Occidental Petroleum vs. Diamondback Energy | Occidental Petroleum vs. EQT Corporation | Occidental Petroleum vs. ONEOK Inc | Occidental Petroleum vs. Imperial Oil |
| Expand Energy vs. Expand Energy | Expand Energy vs. Expand Energy | Expand Energy vs. Cheniere Energy Partners | Expand Energy vs. Woodside Energy Group |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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