Correlation Between Teekay and Borr Drilling
Can any of the company-specific risk be diversified away by investing in both Teekay and Borr Drilling 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 Teekay and Borr Drilling into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teekay and Borr Drilling, you can compare the effects of market volatilities on Teekay and Borr Drilling 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 Teekay with a short position of Borr Drilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teekay and Borr Drilling.
Diversification Opportunities for Teekay and Borr Drilling
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Teekay and Borr is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Teekay and Borr Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Borr Drilling and Teekay 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 Teekay are associated (or correlated) with Borr Drilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Borr Drilling has no effect on the direction of Teekay i.e., Teekay and Borr Drilling go up and down completely randomly.
Pair Corralation between Teekay and Borr Drilling
Allowing for the 90-day total investment horizon Teekay is expected to generate 3.52 times less return on investment than Borr Drilling. But when comparing it to its historical volatility, Teekay is 2.05 times less risky than Borr Drilling. It trades about 0.09 of its potential returns per unit of risk. Borr Drilling is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 309.00 in Borr Drilling on September 10, 2025 and sell it today you would earn a total of 127.00 from holding Borr Drilling or generate 41.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teekay vs. Borr Drilling
Performance |
| Timeline |
| Teekay |
| Borr Drilling |
Teekay and Borr Drilling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teekay and Borr Drilling
The main advantage of trading using opposite Teekay and Borr Drilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teekay position performs unexpectedly, Borr Drilling 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 Borr Drilling will offset losses from the drop in Borr Drilling's long position.| Teekay vs. Global Partners LP | Teekay vs. Precision Drilling | Teekay vs. Borr Drilling | Teekay vs. NGL Energy Partners |
| Borr Drilling vs. Nabors Industries | Borr Drilling vs. Precision Drilling | Borr Drilling vs. Teekay | Borr Drilling vs. Crossamerica Partners LP |
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 Stocks Directory module to find actively traded stocks across global markets.
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